Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

Oral Answers to Questions — EDUCATION AND SCIENCE

Universities (Public Expenditure)

Mr. Bob Brown: asked the Secretary of State for Education and Science (1) if he will introduce legislation to make the University Grants Committee responsible to Parliament in respect of public expenditure;
(2) if he will introduce legislation to make individual universities responsible to Parliament in respect of public expenditure.

The Secretary of State for Education and Science (Mr. Anthony Crosland): This matter has been under examination by the Committee of Public Accounts and I would like an opportunity of considering its Report.

Mr. Brown: Would not my right hon. Friend agree that it is outrageous that such vast sums of public money are being spent by these bodies without any accountability?

Mr. Crosland: This is a matter on which many varied and different views are strongly held, but I think that it is only reasonable, as we know that the Public Accounts Committee's Report is shortly to come out, for me to have an opportunity of considering it before I decide what to do.

Mr. van Straubenzee: While I understand that the inquiry may well be necessary, may I ask the Secretary of State nevertheless to keep very carefully in mind the evidence given to the Robbins Committee that the rest of the world looks with admiration at this method of injecting Government finance while re-

taining the independence of universities, and it should be tampered with only with very great care?

Mr. Crosland: Yes, Sir.

Mr. Mapp: Will my right hon. Friend, without prejudice to the Report of the Public Accounts Committee, not appreciate that there is an overwhelming need for some form of democracy? The question asked for legislation. Is my right hon. Friend not aware that some kind of democracy must be put into this machinery in a new form? Will he keep his mind open in that respect at least?

Mr. Crosland: This exchange from both sides of the House has demonstrated what I said earlier, that strong views are held on this matter but the views are not always in agreement. Since I believe that the Report is due to be published next Tuesday, it would be more sensible for me not to express a strong personal view.

Young People (Voluntary Service)

Mr. Judd: asked the Secretary of State for Education and Science whether he will make a statement on the future of voluntary service by young people within Great Britain.

The Joint Under-Secretary of State for Education and Science (Mr. Denis Howell): A statement will be made as soon as possible.

Mr. Judd: Would my hon. Friend agree that this has been one of the most exciting changes in youth work in recent years, and that if we are to make the best of the possibilities there must be the fullest consultation with the many people at national and local level who have been involved in making a success of developments in that work?

Mr. Howell: I agree that it is exciting work and I am going to great pains to consult as many people as possible before announcing any changes.

University, College and School Facilities (Vacation Use)

Mr. Gwilym Roberts: asked the Secretary of State for Education and Science if he will seek power to ensure


the satisfactory use of university, college, and school facilities and accommodation during the vacations.

Mr. Crosland: I am extremely anxious to ensure what my hon. Friend has in mind, and we are making definite progress in this direction. But I think that we shall do better by strong encouragement rather than by seeking new powers.

Mr. Roberts: Would my right hon. Friend agree, however, that there is an urgent need for a nation-wide O & M inquiry into the use of college staff and buildings, and that an all-the-year-round use of college facilities could greatly increase our output of trained personnel?

Mr. Crosland: I certainly agree with what my hon. Friend has in mind in the second part of his supplementary question, but I do not think that a nation-wide investigation would be suitable because different kinds of colleges have such different problems. But we know that the universities, the colleges of education, and the technical colleges have different types of external or internal inquiry going on into the utilisation of buildings.

Nursery School Teachers

Mr. Gwilym Roberts: asked the Secretary of State for Education and Science what public provision is now made to meet the need for nursery school teachers; and what steps is he taking to increase the supply.

The Minister of State, Department of Education and Science (Mr. Goronwy Roberts): Some 20 colleges of education offer courses designed to prepare students for work with children of the nursery or nursery-infant age range. The number of students taking such courses is rising year by year, as student numbers generally expand.

Mr. Gwilym Roberts: Would my hon. Friend agree that there is an urgent need to improve facilities for nursery training and play groups, and would he seriously consider the provision of special grants to areas like South Bedfordshire, where there is a phenomenally high birth rate?

Mr. Goronwy Roberts: I am sure that we are all in agreement with the general purpose of my hon. Friend's supplementary Question. This is a matter of priority.

We have to attend to the equally, if not more, pressing needs of the infant school range. But we are doing everything we can to encourage, within the limits of our resources, the kind of advance my hon. Friend indicated.

St. John's Church of England School, Bristol

Mr. Robert Cooke: asked the Secretary of State for Education and Science whether he will include St. John's Church of England Voluntary Controlled Junior, Mixed and Infant's School in the next educational building programme for Bristol.

Mr. Denis Howell: No, Sir.

Mr. Cooke: Will the hon. Gentleman look at this matter again, because the school is on an island site surrounded by hurtling traffic and road proposals now being considered may well make life impossible for it in future.

Mr. Howell: I will look at that again, although I am told that the road improvements should improve safety because pedestrian subways are being provided. However, the school has not appeared yet in any of the lists of local authority schools for replacement, and certainly the local authority does not regard it as in the most urgent three or four of its projects.

University Places

Mr. Edward M. Taylor: asked the Secretary of State for Education and Science what estimates he has made of the numbers of young people who will be seeking admission to British universities for the year 1967–68 and the numbers of vacant university places which will be available.

Mr. Crosland: I would refer the hon. Member to my reply of 2nd November, 1966, to the hon. Member for Dumfries (Mr. Monro).—[Vol. 735, c. 125.]

Mr. Taylor: Will the right hon. Gentleman give an assurance that he is not seeking to compensate for the shortsighted reductions in the university building programme by excluding foreign and Commonwealth students, and is he aware that considerable resentment has been caused by the Government seeking to save the small sum of £2 million by


shoving up the fees for foreign and Commonwealth students from £70 to £250 in one fell swoop?

Mr. Crosland: As to the latter part of the supplementary question, there are a number of Questions on that subject later on the Order Paper and I shall reply to them in due time. As to the implication of the first part of the supplementary question, there has been no such cut in the building programme as the hon. Member appeared to imply. The essential fact is that in the universities we are already about 2,000 above the Robbins' targets, which at the time when they were published and accepted by a previous Government were thought to be extremely ambitious

University Clinical Teachers

Mr. Grieve: asked the Secretary of State for Education and Science whether he is aware that clinical teachers in the universities continue to be dissatisfied with the failure to keep their salaries in line with those of their colleagues in the National Health Service; and whether he will now announce his proposals to deal with this matter.

Mr. Boyd-Carpenter: asked the Secretary of State for Education and Science what proposals he now has for bringing the salaries of university clinical staffs into line with comparable remuneration in the National Health Service.

Mr. Goronwy Roberts: The increases effective from 1st October last which my right hon. Friend announced on 15th December maintain the relationship between the pay of university clinical teachers and that of National Health Service hospital doctors. Any long-term adjustment of that relationship will be a matter for consideration by the new machinery for determining the salaries of all university academic staff.

Mr. Grieve: While I am very grateful to the hon. Member for that reply, may I ask whether it does not mean that with a rise back-dated to 1st October last the clinical teachers are lagging about two years behind the hospital staff in their pay increase? Is this a proper way to treat a service which is indispensable to the education of our future doctors, and should not the—

Mr. Speaker: Order. Questions, however important, must be brief.

Mr. Roberts: I agree that there is disparity here, but, as announced on 15th December, the university clinical teachers are to receive an increase which will reflect the award to the hospital doctors and through which they will recover much of the lost ground. On the other hand, we must remember that this is a case of dual source payment, by both universities and the National Health Service, and I would imagine that this would be part of the consideration given by the new machinery for deciding the rate of payments to university staffs generally.

Mr. Boyd-Carpenter: But is the hon. Gentleman not aware that the grievance is the time-lag to which my hon. and learned Friend referred, and can he assure the House that the new arrangements will make sure that these very important teachers move in line with the hospital doctors and not two years afterwards?

Mr. Roberts: I cannot anticipate the consideration which the body set up to make the new arrangements will give to this, but I would certainly hope that what the right hon. Gentleman has suggested would happen—very much so.

Mr. Grieve: asked the Secretary of State for Education and Science how many university clinical teachers have relinquished their appointments and have emigrated in 1965 and 1966, respectively.

Mr. Goronwy Roberts: Eighteen teachers of clinical medicine in 1964–65 according to the universities' returns to the U.G.C. Figures for 1965–66 are not yet available.

Mr. Grieve: Does not the hon. Gentleman agree that these figures denote the dissatisfaction in this branch of the university service, and will he take steps to ensure that the cause of the dissatisfaction is removed in order to prevent the brain drain from becoming a torrent?

Mr. Roberts: I agree that we should all do everything we can to staunch the brain drain, but I would remind the hon. and learned Gentleman and the House that the total number of clinical teachers in 1964–65 was 1,442, so that the loss


represented 1·2 per cent. over the academic year. This is a gross figure. We must also remember that some came from abroad to take up appointments here.

Immigrants

Mr Marquand: asked the Secretary of State for Education and Science how many schools in the country do not yet conform to the principles laid down in paragraph 8 of his Department's Circular 7/65 on the Education of Immigrants; and whether he will make a statement.

Mr. Denis Howell: In January, 1966, there were 313 schools in which immigrants formed more than one-third of the total roll. It is for the local education authorities to consider what might be done to reduce the proportion of immigrants in these schools. My information is that the majority of authorities agree that it is desirable to impose some limits on the proportion of immigrant children in a school and are seeking to achieve this in various ways.

Mr. Marquand: Is my hon. Friend aware that that is still a rather depressing figure, and can he say what steps he is taking to speed local authorities on?

Mr. Howell: I will send my hon. Friend a copy of the circular that we sent out. This is essentially a matter for the local authorities themselves, but we have had discussions and I should like to embark on further discussions with some of the authorities with which the problem is greatest. We hope very much that these local authorities will see the sense of dispersing if we are to provide integrated schools, which I am sure is the object of all of us.

Mr. John Hall: Will the hon. Gentleman agree that carrying out effectively the recommendations of the Ministry imposes considerable additional cost on the local authority concerned? Is he considering ways and means by which local authorities can be helped to meet the cost?

Mr. Howell: This is a consideration that we have borne in mind, but I believe that dispersal can be carried out in many ways and best at the point of entry of the child into the school, and in those cases it is not necessarily costly.

Sir E. Boyle: Has not the hon. Member for Ashfield (Mr. Marquand) a real point here in calling attention to the relatively small response of local authorities? Where there are disagreements, ought not these to be argued out at the Ministry so that people know what the policy is and we have a definite line on the subject?

Mr. Howell: We know what the policy is. I agree that it is a very important point, which is why I am about to embark on a new series of discussions with the appropriate authorities.

Commonwealth Immigrants (Teaching Posts)

Mr. Marquand: asked the Secretary of State for Education and Science what steps he is taking to ensure that Commonwealth immigrants admitted to this country on school-teacher vouchers receive suitable training to enable them to take up teaching posts in British schools.

Mr. Denis Howell: The Department has sponsored four full-time courses of 15 months' duration for such immigrant teachers, 65 teachers are at present attending these. We are reviewing the need for any further provision of this type in the light of the experience already gained.

Mr. Marquand: Would my hon. Friend agree that a large number of Commonwealth immigrants who came in on teaching vouchers are still doing unskilled jobs? Would he further agree that the ideal would be that one of the three following things should happen: first, immigrants who want to come here on teaching vouchers should be told that they probably will not be able to get jobs as teachers; secondly, only immigrant teachers with qualifications that are suitable for English schools should be allowed in; thirdly, as a matter of routine all immigrants who come here on teaching vouchers should receive suitable training? Can my hon. Friend say how this is likely to be achieved?

Mr. Howell: I cannot agree that there are many teachers coming in who cannot get employment. When I examined all the cases brought to our attention I found that, generally speaking, the great difficulty is language. It is essential for


a teacher to be understood by the children he or she is trying to teach. However, if my hon. Friend has any specific cases in mind I shall be most anxious to look at them individually.

Mr. Ronald Bell: Would the hon. Gentleman agree that the qualifications for teachers in some Commonwealth and foreign countries are quite different from the qualifications that we expect here, and that some well-informed people have expressed the view that many of the people coming in on these vouchers could not profit from our teacher-training courses?

Mr. Howell: I think that there may have been something in that a year or two ago, but since we made it well understood that we have to maintain professional standards in our own teaching profession and adjusted our own regulations accordingly, I think there is less cause for concern.

National Child Development Study

Mr. J. E. B. Hill: asked the Secretary of State for Education and Science what action he proposes to take to remedy the educational deficiencies disclosed in the first report of the National Child Development Study.

Mr. Crosland: The findings of this interesting study were taken fully into account by the Plowden Council whose Report I am now considering.

Mr. Hill: This is a unique study in the length and depth of child development. It has shown great value already and has great prospective value. Is it not highly desirable that it should continue? In view of the evidence it has shown of the significant number of children with special learning difficulties, will the right hon. Gentleman advise the local authorities as to the appropriate age of transfer to special schools?

Mr. Crosland: I agree about the extreme value of this study, which was largely financed by my Department in conjunction with two others. I will consider the question of continuation of the study. As to a recommendation on the point mentioned by the hon. Gentleman, I would prefer to consider all the recommendation of this study in the light of those of the Plowden Report. Practically

all of them were taken into account by the Plowden Council.

Sir E. Boyle: Would not the right hon. Gentleman agree that the findings of the study were one of the most important contributions to the Appendix to the Plowden Council's Report? Will he bear in mind that we on this side of the House attach the highest importance to this study continuing?

Mr. Crosland: I accept what the right hon. Gentleman has said. I would mention that, whereas the Appendix to the Report contains only a summary of the study, a full report will be published this month.

Grammar and Comprehensive School Education (Comparability Studies)

Mr. J. E. B. Hill: asked the Secretary of State for Education and Science whether he has made, is making, or will make comparability studies of the educational progress and achievement of the abler children in grammar and in comprehensive schools.

Mr. Crosland: No, Sir.

Mr. Hill: Does not the right hon. Gentleman agree that, both in the national interest and in the interest of the ablest children, it is highly desirable that such comparability studies should be made and that, for them to be made, it is essential that some grammar schools of high quality should continue to co-exist with comprehensive schools?

Mr. Crosland: No, Sir. In this developing situation it is impossible to make detailed comparative studies like this because, in an area where selective schools still exist, comprehensive schools are not properly comprehensive because they are being creamed of their top ability while, on the other hand, when a school becomes comprehensive, a comparability study becomes impossible. The situation is moving in a manner which precludes this kind of study.

Mr. Hooley: Does not my right hon. Friend agree that the aim of comprehensive education is to develop the progress and achievement of all children and not merely the ablest ones?

Mr. Crosland: I agree. It is the strong impression of those most concerned that the ablest children do not suffer in nonselective schools, whereas we know that a great number of less able children suffer from going to selective schools.

Mrs. Knight: Does not the Secretary of State agree that to make such a revolutionary change in the educational pattern should have better statistics to support it than merely the opinions of right hon. and hon. Members opposite?

Mr. Crosland: This is not a question of statistics and the Question on the Order Paper concerned certain types of education research. The simple fact is that this decision—whether or not to maintain the 11-plus—is not one which can be taken by researchers. It must be taken by the Government—and, of course, a similar decision was taken by the previous Government.

Sir E. Boyle: Is the right hon. Gentleman aware that, irrespective of party, many people are particularly concerned about the mathematics and science teaching for the ablest pupils if we have too great a dispersal of skilled sixth form teaching resources?

Mr. Crosland: The shortage of mathematics and science teachers existed long before the arrival of the Government and has been a persistent problem for many years. The size of sixth forms is one of the things to take into account in deciding whether to approve schemes or not. We made that clear in Circular 10/65.

Student Awards

Sir J. Vaughan-Morgan: asked the Secretary of State for Education and Science whether he is aware of the handicaps suffered by widows, separated and divorced wives in relation to student awards; and whether he will make further proposals to encourage recruitment.

Mr. Goronwy Roberts: I do not consider that the present rules governing awards constitute a handicap in the cases quoted.

Sir J. Vaughan-Morgan: On what does the hon. Gentleman base that curious remark? Has not he received representations on this matter from the National Union of Teachers?

Mr. Roberts: Students independent of their parents and others—single widows, separated and divorced wives—are treated on the same basis if the comparison is with married women students, and I remind the right hon. Gentleman that this is a consequence of a recommendation of the Committee on Grants to Students, under the chairmanship of Sir Colin Anderson, in 1960. We are continually looking at these cases. It is not an easy matter. If the right hon. Gentleman would like to see me about it I would be glad to discuss it with him.

Sir J. Vaughan-Morgan: asked the Secretary of State for Education and Science whether he will extend the alternative method of assessment for student grants, now applicable to widows, to separated and to divorced wives.

Mr. Goronwy Roberts: This concession was introduced last year in the context of the abolition of the National Insurance earnings rule in relation to widows' pensions. My right hon. Friend does not propose to extend it.

Sir J. Vaughan-Morgan: Why has the Minister of State taken this rather obdurate attitude in view of the representations he has received? Is not he aware that this situation is creating anomalies, with widows and separated wives working side by side and getting different awards? Is not he further aware that some women are being discouraged and inhibited from recruitment as a result?

Mr. Roberts: If the alternative arrangement were extended to separated and divorced wives, it would be difficult to resist making a similar concession to other students with an income of their own, including single and married men. The whole category could come in with those the right hon. Gentleman mentions. This would create new disparities in overcoming one.

Mr. Allason: If the hon. Gentleman is not aware of the difficulties will he receive further representations? There is a genuine problem here and he appears to gloss over it.

Mr. Roberts: I am aware of the feeling and I am continually looking at cases of alleged hardship. I am very willing to meet any hon. Members on either side


or to hear representations. We are looking at this matter all the time to see what we can do about these very difficult anomalies.

Nursery Schools

Mr. Winnick: asked the Secretary of State for Education and Science if he will now review the existing regulations for nursery schools.

Mr. Denis Howell: My right hon. Friend will be considering this whole question in the light of the recommendations of the Plowden Council.

Mr. Winnick: Is my hon. Friend aware that there is a tremendous need for nursery school places which, in most cases, is not being satisfied? May we know when there is to be any real change or relaxation of the existing restrictions on nursery school places?

Mr. Howell: We certainly cannot know that today. Although we agree in principle with what my hon. Friend has said, the hon. Gentleman will be aware that it is entirely a question of economic priorities.

Mr. Ridsdale: Will the hon. Gentleman pay attention to the private nursery schools, which are suffering a great deal of handicap because of the Selective Employment Tax?

Mr. Howell: I take note of the hon. Gentleman's comment.

Physical Education (Games)

Mr. James Johnson: asked the Secretary of State for Education and Science if he will make a statement on his policy towards the playing of games in schools.

Mr. Denis Howell: Physical education like other parts of the curriculum is primarily a matter for local education authorities and schools. It is generally accepted that the curriculum should include a balanced programme of physical education, which would include games, and I agree with this view. I also believe that pupils should be introduced to as wide a variety of choice in sport and recreation as is practically possible.

Mr. Johnson: As a former "knight of the whistle" will my hon. Friend advise local education authorities to give boys a choice of all codes of football? Is he

aware that there has been a sustained campaign for many years by some headmasters to change from one code to another? Will he take the example of Hull, where we play all games—with eleven a side, fifteen a side and, not least, thirteen a side?

Mr. Howell: I know that Hull is doing very well these days. I am constantly advising local authorities about this matter. I agree that choice in matters of leisure and sport is the end product of education.

Mr. Peter Mills: Is the hon. Gentleman aware that the great disadvantage of children in primary schools—and I speak as the parent of one; no, two—is that they have no playing fields to play upon? Will he do all he can to see that children in primary schools have the advantage of being able to play games.

Mr. Howell: This is the first time I have heard of a recount in the Chamber itself. As the father of four children, I agree with the hon. Gentleman I think that we need many more sporting facilities so that all primary children have an opportunity to get out into the open and play games.

Teachers

Sir E. Boyle: asked the Secretary of State for Education and Science what was the net increase in the number of full-time teachers in primary and secondary schools between January, 1965, and January, 1966, and in the corresponding two previous years.

Mr. Crosland: Approximately 4,300, 5,300 and 4,900 in the three years ended January, 1964, 1965 and 1966 respectively. I expect the figures in the subsequent two years to be 5,000 and 7,000.

Sir E. Boyle: Is not that decline from 5,300 to 4,900 disappointing and is the right hon. Gentleman aware of the very real concern caused by his recent circular on the quota and on teacher supply? What does he think has happened to the missing teachers, as it were, and has his attention been drawn to the real anxiety about the numbers of those receiving three-year grants who go through colleges of education and then opt out for some activity other than teaching?

Mr. Crosland: That was a very large number of questions in one. The fact is that we had one short period in which wastage produced a slight drop in the annual increase. But looking ahead it is perfectly clear, and it is clear from the last two figures which I quoted, that the huge investment which we have made in teacher training is now beginning to show very considerable dividends. When discussing full-time teachers we must remember the important and growing addition to the teaching force which, I am glad to say, is made by part-timers. As the right hon. Gentleman knows, for demographic reasons we are in the most difficult period at the moment, but I think that can see some easement in two or three years' time.

Mr. Gwilym Roberts: Would not my right hon. Friend agree that any present deficiency in teacher numbers is a byproduct of the failure of teacher-training provision under a previous Administration and that there are now healthy trends which show that the position will be rectified in a very few years?

Mr. Crosland: It is certainly the case that there has been a massive and dramatic increase in teacher-training facilities in the last two years and my hon. Friend is quite right to say that, although we are now in a period of hard slogging because of the very rapid increase in the birth rate, looking ahead two or three years we can see a dramatic improvement.

Sir E. Boyle: If we are to argue about this, is it not a fact that the college of education building programme for the first year of the party opposite was less than our building programme for 1964–65? However, can I ask the right hon. Gentleman a more serious question? Is it not quite clear from the figures which he has given that it will be highly undesirable if there is a hold-up in the provision of university places compared with places in colleges of education, because nothing could be worse than that would-be university students should go to colleges of education and take places which might otherwise be occupied by those who could swell the teaching force in the schools?

Mr. Crosland: I do not know what the right hon. Gentleman means when he talks about a hold-up in university places. I

have already said in answer to a previous Question that we are already well ahead of the Robbins target for universities and I think that we will continue to be so. As for teacher supply, the only acid and important test is an increase in the number of teachers per year. The figures which I have quoted show that the increase this year will be much larger than in any year over the last few years, and I think this improvement will continue.

Primary School Classes (Size)

Sir E. Boyle: asked the Secretary of State for Education and Science how many primary school classes in England and Wales contain more than 50 pupils.

Mr. Crosland: Seventy-one.

Sir E. Boyle: Does not that Answer, for which I am grateful, suggest that Homer was nodding when the right hon. Gentleman said at the N.U.S. conference on 28th November that we still have not merely hundreds but thousands of primary schools with classes not only over 40, but over 50?

Mr. Crosland: I confess that I do not have a word-by-word recollection of what I said to that rather stormy audience of the National Union of Students, but, if my words were precisely as quoted by the right hon. Gentleman, they seem to have contained an element of exaggeration.

Comprehensive Secondary Education

Mr. Brooks: asked the Secretary of State for Education and Science whether he will consider publishing regular detailed progress reports of the steps being taken by each local education authority to introduce comprehensive secondary education.

Mr. Crosland: I am afraid that the process of preparing and implementing schemes of reorganisation does not lend itself to this kind of regular analysis.

Mr. Brooks: Would not my right hon. Friend agree that with local government reorganisation fairly imminent it is especially important that local education authorities, particularly in neighbouring areas of a conurbation, should have very


full details of the schemes now being implemented by their neighbours?

Mr. Crosland: I certainly agree with that proposition, which, I would have thought, was as much a matter for local co-operation as for national action on my part. All I was saying was that with 162 authorities, all of them at different stages of preparation or implementation, it would be very difficult to give, say, monthly detailed reports of exactly what stage they had reached.

Colleges of Education (Men Students)

Mr. Charles Morrison: asked the Secretary of State for Education and Science whether he is satisfied with the proportion of women to men students entering colleges of education in 1966; and if he will make a statement.

Mr. Goronwy Roberts: I would like to see the proportion of men students in the colleges rise to about 35 per cent. by 1970. In fact the number of men entrants was 50 per cent. greater this year than it was three years ago, but the equally rapid increase in women students meant that the proportion of men remained at 28 per cent.

Mr. Morrison: Bearing in mind that the Plowden Report says that in 1965 there were only 97 men out of 33,000 infant teachers and that 40 per cent. of all primary schools had no men teachers, what further steps is the Department taking to encourage recruitment of men teachers, particularly in the light of the Plowden recommendations on middle schools?

Mr. Roberts: I agree that an increase in the proportion of men entering training would help the overall starting position in more ways than one. We have sent to the heads of schools urging them and their staffs to draw the attention of boy pupils in sixth forms to the value of the higher education which colleges of education can provide and also the preparation which they give for a valuable career in teaching. It is perhaps too soon to evaluate the results of this special appeal, but it is encouraging to note that the number of men applicants—[Interruption.] May I join the general welcome given by the House to

the hon. Member for Devon, North (Mr. Thorpe). It is encouraging to note that the number of new entrants—[Laughter.]—currently registered with the clearing house—[Laughter.]—is about 750 more than at the same time last year.

Sex Education and Adult Relationships

Mrs. Renée Short: asked the Secretary of State for Education and Science what guidance is given by his Department to teachers in secondary schools responsible for sex education and instruction in adult relationships.

Mr. Denis Howell: Advice is given in the Department's pamphlets on "Health in Education", of which I am sending my hon. Friend a copy, and on "Health Education", which is now being revised.

Mrs. Short: I thank my hon. Friend for that reply. Does he not agree that where parents refuse to accept this responsibility towards their children, then the teaching profession can play a very valuable part in helping children over this hurdle? Is he aware that some schools deal with this very well, while others do not tackle it at all? Will he assure the House that he will keep his eye on this problem?

Mr. Howell: I entirely agree that this is a matter of importance and I think that it is well understood to be so by most of the teaching profession. I hope that the revised copy of "Health Education", which will shortly be completed, will help to produce the result which my hon. Friend requires.

Nursery Classes

Mrs. Renée Short: asked the Secretary of State for Education and Science how many local education authorities have now opened nursery classes; how many others intend to do so in the foreseeable future; and how many teachers have returned to teaching as a result since his circular on nursery classes was published.

Mr. Crosland: I cannot at present add to the Answer which I gave to my hon. Friend on 16th June, [Vol. 729, c. 304.] but the latest figures should be available in March.

Mrs. Short: May I thank my right hon. Friend for that reply and ask him if, in view of the recent publication of the Plowden Report, he will give this matter very urgent consideration? Will he bear in mind that the nation can have the whole of Plowden providing that we give up one Polaris nuclear submarine? Will the Minister press for this in the Cabinet?

Mr. Crosland: That goes slightly wider than the immediate question, but I will certainly bear all of these diverse matters in mind.

Public Schools Commission

Mr. Wingfield Digby: asked the Secretary of State for Education and Sciénce how many schools have been visited by the Public Schools Commission; and to what extent reports on public schools by inspectors of his Department have been submitted to it.

Mr. Crosland: I do not expect to be kept in touch with the Commission's day-to-day work. Reports on public schools by H.M. Inspectors have been made available to the Commission only by permission of their governing bodies.

Mr. Digby: Is the right hon. Gentleman aware of the thoroughness and excellence of these reports? In view of the financial demands of the Plowden Commission, has the right hon. Gentleman made up his mind about how much money is to be available to implement any recommendation that the Commission may make?

Mr. Crosland: No. Sir.

Training Ship "Foudroyant" (Grant)

Mr. Hamling: asked the Secretary of State for Education and Science what reports he has received on the work for young people performed by the training ship "Foudroyant"; and if he will increase the grant paid by his Department to this enterprise.

Mr. Denis Howell: I am aware of the good work done by this establishment; the grant for 1967–68 will be announced in April.

Mr. Hamling: Can my hon. Friend take an early opportunity of visiting the

"Foudroyant" to see the work that she does?

Mr. Howell: If I am invited I will consider it.

Albermarle Report

Mr. Hamling: asked the Secretary of State for Education and Science what further steps he is taking to implement the Albermarle Report; and whether he will make a statement.

Mr. Denis Howell: The main recommendations have been implemented. In particular, the provisional target of 1,300 full-time leaders by 1966 has been reached. The development of the Youth Service to meet changing needs is a continuing process. In this the recently reconstituted Youth Service Development Council will review the whole service and, through subcommittees examine specific problems in depth. Two of these are under way, dealing with immigrants and the Youth Service, and the relationship of the Youth Service to formal education. The third subject will be the relationship of the Youth Service to the community as a whole.

Mr. Hamling: In the light of that helpful reply, will my hon. Friend also take another look at the unhelpful replies previously given to our questions about the Inverliever project?

Mr. Howell: We were asked about that and in consequence of the promise I made to the House I am looking at it further.

Direct Grant Schools

Mr. Raphael Tuck: asked the Secretary of State for Education and Science to what extent it is Government policy that integration of direct grant schools into the comprehensive system will involve their being allowed to continue a selective system of entry.

Mr. Crosland: Government policy on this matter was laid down in Circular 10/65, of which I am sending my hon. Friend a copy.

Mr. Tuck: Is it true that my right hon. Friend has chosen to regard the Leeds direct grant school as fully integrated into the comprehensive system, which it is not because three-quarters of


the students are selected at 11? Is it not a fact that he also said that he would like to see such schemes extended to other areas?

Mr. Crosland: I said no such thing about Leeds. What I said was that I noted with interest the agreement between the direct grant school and the authority. The agreement does not provide for selective entry but an unselective entry for certain pupils at a certain age.

Sir E. Boyle: Is it not a fact that the Leeds authority has proposed to take up places not at 11-plus but at the sixth form level for those who could not get courses that they would otherwise wish to get in their present schools? Is the right hon. Gentleman aware that we on this side would regard this as a reasonable compromise and that we would most profoundly object to any attempt by the party opposite to upset this sort of proposal?

Mr. Crosland: This is their suggestion. I was asked to say whether I regarded this as a full integration of the school. It is not and that is all that there is to it. The right hon. Gentleman accurately describes the scheme which was approved by the authority and the school. I noted this with interest and would certainly like to see how it works.

Mr. Alexander W. Lyon: Is my right hon. Friend aware that this is an unreasonable compromise? Is he further aware that it does not seem reasonable to many of us on this side, and that we are viewing with concern the fact that the Leeds education authority had this proposal put to it by the Ministry? Does he not agree that this proposal is nothing like the integration of the direct grant school into the State system?

Mr. Crosland: Once again I must insist that no one has mentioned the word "integration" in connection with this. The school has not been integrated into the system. No one pretends that this is so. As to the inception of this proposal, this is the first time that I have heard that it came from the Department. As far I am concerned, this was a proposal which came to me from, I may add, a Labour local education authority, in agreement with the school.

Primary Schools

Mr. Raphael Tuck: asked the Secretary of State for Education and Science in the forward planning of allocation of resources to the schools, if it is his policy that a large enough increase is to be allocated to enable primary schools to meet the educational needs of the pupils in them.

Mr. Crosland: It is my policy, within the resources available, to meet educational needs in all parts of the educational system.

Mr. Tuck: Is my right hon. Friend aware that the Plowden Report has stated that there is no educational justification whatever for such a wide disparity as exists today between the money available per pupil in the primary school and the money available per pupil in the secondary school? What does he propose to do about this?

Mr. Crosland: I am well aware that the Plowden Report states that, and makes a large number of other recommendations. I have very great sympathy with the priority which the Plowden Report wishes to give to primary schools, but one cannot pick out one particular sector of education and give it some overriding priority. In the short term, as I shall say in answer to a Written Question, I am in very broad sympathy with the tenor and philosophy of the Plowden Report.

Mr. Bessell: May I ask the right hon. Gentleman if he is aware of the very grave difficulties in which primary school teachers are seeking to do their jobs in rural areas, particularly Cornwall? Will he look at this as being a special problem, distinct from the national problem?

Mr. Crosland: No, Sir. One must look at this as a national problem. I have said repeatedly that I have been responsible for the school building programme for only two years. For the previous 13 the party opposite was responsible. It is for this reason that I have said that, after we allow for basic needs, the improvement or replacement of primary schools should have priority.

Museums and Galleries (Acquisition of Works of Art)

Mr. Strauss: asked the Secretary of State for Education and Science whether he will amend the rules of the committee responsible for the granting and withholding of export licences for works of art so as to enable museums and London galleries to acquire important works which are not already represented in any public gallery.

The Joint Under-Secretary of State for Education and Science (Miss Jennie Lee): I have this matter under consideration. I am most anxious that both our regional and London museums and galleries should have the fullest opportunity to acquire important works of art.

Mr. Strauss: Is my right hon. Friend aware that many important historic objects, which are part of our national heritage, are leaving this country in great quantities, although our museums which do not possess such objects are most anxious to acquire them? Does she not agree that it is therefore necessary to take early action to check this flow by giving new terms of reference to the Reviewing Committee?

Miss Lee: I would not entirely agree with the right hon. Gentleman. We are looking into this matter but we have always to bear in mind that London is a great international art-dealing centre. We have to keep a proper balance between our domestic interests and these other considerations.

PRIME MINISTER (VISIT TO ROME)

Mr. Marten: asked the Prime Minister if he will make a statement about his visit to Rome.

Mr. Archer: asked the Prime Minister if he will make a statement on his recent visit to Rome.

Mr. Rankin: asked the Prime Minister if he will make a statement on his recent discussions with the Italian Government.

Mr. St. John-Stevas: asked the Prime Minister whether he will make a

statement about his recent talks in Rome with the Prime Minister of Italy and other representatives of the Italian Government.

The Prime Minister (Mr. Harold Wilson): My right hon. Friend the Foreign Secretary and I visited Rome from 15th to 17th January for talks with Signor Moro, President of the Council of Ministers of Italy, Signor Nenni, Vice President of the Council, and Signor Fanfani, the Italian Foreign Minister. Our visit was the first of the round of visits to Heads of Government of the Six in which, as I explained to the House in my statement of 10th November, my right hon. Friend and I will be exploring whether the conditions exist for fruitful negotiations leading to British membership of the European Economic Community. We are most grateful to the Italian Ministers for having enabled us to discuss with them the problems that will be faced in any eventual negotiations. I think our visit was a successful one.

Mr. Marten: While recognising that the Prime Minister clearly does not want to lay Britain's negotiating cards on the table face upwards at this stage, nevertheless may I ask him to tell the House what political and economic concessions the Italian Government thought might be entailed by our joining the E.E.C.?

The Prime Minister: What the hon. Gentleman said at the beginning of his Question is important. We were not in a negotiating posture and there was no suggestion by them of any political or economic concessions that would be necessary. But we went very fully over the ground of the principal difficulties

Mr. Archer: Is my right hon. Friend aware that there will be a very warm welcome in the country for what The Guardian today called a new pattern of open discussion, without commitment on either side? While there are clear benefits to be derived from this, will he take care to avoid a situation where the House is not kept fully informed of developments which are going beyond discussions?

The Prime Minister: I agree about the phrase, without commitments on either side. I am a little worried about the word "open" being taken too literally.

Mr. Rankin: Can my right hon. Friend say, after his training spell in Rome, that he is now fitter for his tougher time in Paris? Can he tell us whether the decisions reached at Rome will prove helpful in discussions with General de Gaulle?

The Prime Minister: The discussions in Rome were a very useful start and will be of great assistance to our discussions in all of the other five capitals. No decisions as such were taken in Rome because I have undertaken to report back to this House on any decision that the Government take after they review the results of these visits.

Mr. St. John-Stevas: At the Press conference in Rome the Prime Minister was reported as saying that he was against the domination of European industrial life by United States business. Was that intended to be taken seriously, and if so, what precise proposals does the Prime Minister have in mind to avoid this situation?

The Prime Minister: What I said in Rome I said two years ago and have said a number of times since. I said that our loyal membership of N.A.T.O. does not mean that we for our part think it right that vital sectors particularly of the technological industries of Europe should be overrun and dominated by American firms. I had very much in mind—indeed I said a few words to show that I had—the specific factors of the Chrysler-Rootes situation in which there had been a total breakdown of management and where there was no question of selling out a technological industry. The Government have shown that they mean business about this by the way in which we have saved our own computer industry, unlike others in Europe, from the predatory actions of certain American firms.

Mr. Thorpe: Is the Prime Minister aware that there will be great satisfaction with the apparently warm reception of the British approach in Rome? May I ask him how detailed the discussions were—whether there was, for example, any discussion about the transitional phase required for British agriculture? Secondly, since he is going to Paris on Monday, I understand, would he agree that the £650 million swing-wing aircraft agreement augurs well for

those discussions? Is he aware that almost all the House hopes that his talks in Paris will be as successful as those in Rome?

The Prime Minister: I hope that I should not be too far out of order if I were to offer the hon. Gentleman the congratulations of the whole House on his election yesterday and to express the confident hope that with him as leader of the Liberal Party, as with his predecessor, the relations between the party leaders in the House will continue to be as friendly as they always have been. I know that I speak also for the Leader of the Opposition.
I thank the hon. Gentleman for what he said about the visit to Rome. Certainly the agreement with the French Government on what really means the integration of our aircraft industries for the production of the main weapons of the Royal Air Force and French Air Force for the later 1970s is. I believe, a very important step, not only to what we are trying to achieve in Paris, but as further proof of what I said in answer to the hon. Member for Chelmsford (Mr St. John-Stevas).

Mr. Heath: While acknowledging that discussions of this kind are bound to be confidential to a considerable degree, may I ask the Prime Minister whether he recognises that the House would like to have rather fuller information after each visit than he felt able to give today in his main Answer to these Questions? After all, after each meeting the Press is given a considerable amount of information. I should have thought that the House of Commons was entitled to at least the same amount of information as was given to the Press.
May I ask the right hon. Gentleman two questions. First, there have been confusing reports about what was said to the Italian Government about a common agricultural policy and the Government's attitude to it. One said that the Government told the Italians that they accepted it. The other said that there had to be major adjustments. Would the right hon. Gentleman say which report was correct? Secondly, could he say whether the British Government and Italian Government were in agreement about the future political development of Europe?

The Prime Minister: I will certainly consider what can be done to say more to the House about these talks after each meeting. I am conscious that I failed to answer the question about what topics were discussed. There was a very full discussion about agriculture—it took, I should think, something like half the time we were there—and we stressed the very great difficulties, not least—this is what I said to the Press—the problem of the levy system with particular reference to the fact that it would mean a big change in the pattern within Europe, because, unlike the Six, we are a major food importer and it would mean a very big transfer across the exchanges. This was fully understood.
With regard to the Press reports, it is not my job normally to confirm or deny them, but certainly one of those Press stories—the suggestion that we accept in full, without any question of amendment, adaptation, transitional provisions or anything else, the common agricultural programme—was inaccurate.
We had a very good and friendly discussion about political developments. We said—and I think that this was welcomed, and I shall be dealing with this subject in a speech next week in Strasbourg —that we regard one of the major arguments to be not only the economic advantages to us and Europe but also greater political unity, and we shall cooperate to the full in anything which can be done to achieve greater political unity if we enter the Common Market.

EUROPEAN ECONOMIC COMMUNITY

Mr. Channon: asked the Prime Minister if he will make a statement about the progress of his negotiations about the possibility of British entry into the European Economic Community and what discussions have taken place with Commonwealth countries, European Free Trade Association countries and countries in the European Economic Community since 10th November.

The Prime Minister: These are not, as yet, negotiations, Sir. As the Answer to the rest of the hon. Member's Question is rather long I will, with permission, circulate it in the OFFICIAL REPORT.

Following is the information:
As to discussions with the Commonwealth, would refer the hon. Member to the Answers which I gave to Questions by the right hon. Gentleman the Member for Thirsk and Malton and my hon. Friend the Member for Fife West on 13th December last; as to the European Free Trade Association I would refer him to the speech made by my right hon. Friend the Foreign Secretary in our Debate on 6th December last; and as to the European Economic Community I would refer him to the Answer I have given today on the visit of my right hon. Friend the Foreign Secretary and myself to Rome.—[Vol. 738, c. 242, Vol. 737, c. 1165.]

RHODESIA

Mr. Channon: asked the Prime Minister whether he will now make a further statement about the Rhodesian situation.

Mr. Edward M. Taylor: asked the Prime Minister what plans he has to reopen discussions with Mr. Smith regarding a possible settlement of the Rhodesian problem.

Mr. Longden: asked the Prime Minister when he proposes to reopen negotiations with the illegal Government of Rhodesia.

Mr. Worsley: asked the Prime Minister what conditions he now lays down for reopening negotiations with Rhodesia.

Mr. Anthony Royle: asked the Prime Minister what further steps he is taking to solve the Rhodesian dispute: and if he will make a statement.

The Prime Minister: I would refer hon. Members to the Answers given by my right hon. Friend the First Secretary of State to similar Questions last Tuesday.—[Vol. 739, c. 24.]

Mr. Channon: Can the Prime Minister give a categorical denial this afternoon that Her Majesty's Government have put any pressure whatsoever on the World Health Organisation to cease supplying information to Rhodesia, as any such pressure would be contrary to the interests of both the Europeans and the Africans in Rhodesia?

The Prime Minister: With all the information available to me, I would certainly deny this. There has been no such pressure. However, in view of the hon.


Member's question, I will confirm that this is so.

Mr. Taylor: Should mandatory sanctions fail to achieve the Prime Minister's object—and he must have considered that possibility—would he say clearly whether the final decision on the next step of escalation will be made by Great Britain or the United Nations?

The Prime Minister: As I explained to the House in a speech of greater length than I intended, we have always sought to keep control of this matter in our own hands. We intend to do so—if by "escalation" the hon. Gentleman refers to an intensification of sanctions or any further steps to make the sanctions more effective.

Mr. Longden: May I, first, express the hope that relations between the Prime Minister and Mr. Smith will be as friendly as they have always been? Secondly, irrespective of the wisdom, for the time being, of having raised the matter in the United Nations, or, for that matter, in Trafalgar Square, does the Prime Minister realise that "no negotiations before majority rule" must mean that there will be no negotiations within the next 15 or 20 years? Is that really his policy?

The Prime Minister: I appreciate the hon. Gentleman's opening words. In fact, my personal relations with Mr. Smith have always been extremely good, and they were particularly good in our discussions on H.M.S. "Tiger". The tragedy was that when he returned to Rhodesia he was not able to make effective, as I know he would have wished to have done, the agreement which we had reached because he was under the control of some very strong extremists of a kind who perhaps were fully represented on the fringe of the crowd supporting the right hon. Member for Streatham (Mr. Sandys) in Trafalgar Square.
On the second part of the hon. Gentleman's supplementary question, there was never any suggestion that there could be no negotiations before the achievement of majority rule. The declaration which we made was exactly in the terms of the Commonwealth communiqué and, apart from the control of this very small group of extremists, there is nothing to stop Rhodesia returning to constitutional rule, and certainly, as I say in answer to a

later Question, this would mean a return to the 1961 Constitution. But we could have further negotiations with them thereafter about any developments or changes in that Constitution.

Mr. Royle: Would the Prime Minister answer the question of my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward M. Taylor)? Is he aware that the United States Congress is not in favour of supporting sanctions? In view of this, it is clear that sanctions will fail. Therefore, what steps will the Prime Minister take when they fail?

The Prime Minister: The hon. Gentleman must take the responsibility of speaking for the United States Congress on this matter. I know the action taken by the United States Government. In international affairs, however, I am able to speak for the House of Commons, which supported, by a large majority, the action of Her Majesty's Government and rejected the Opposition's support of the extremist rejection of the "Tiger" agreement.

Mr. Heffer: In view of the fact that there has developed a businessmen's opposition to Mr. Smith, who interpret the agreement that was not reached or signed to mean that there can be no independent rule for the coloured people of Rhodesia for at least 70 years, may we have an assurance from the Prime Minister that under no circumstances will there be any treating with such a group who are, in fact, committed to a policy of white majority rule in Rhodesia?

The Prime Minister: I do not quite understand my hon. Friend's reference to 70 years. The agreement on H.M.S. "Tiger" would have meant, on the best calculations, majority rule probably after a second General Election there, or possibly after a third; and no opposition whatever was at any time raised by Mr. Smith to that proposition. [HON. MEMBERS: "0h"] None at all. It is only since he got back that the extremists have been talking in terms which would mean an extension, possibly indefinitely, beyond the period envisaged on H.M.S. "Tiger", but I have not heard a reference to 70 years.
As for the internal political situation in Rhodesia, it is always difficult, in what


various party leaders have called a police State, to assess the importance of what is going on there. But we should not feel inhibited—indeed, we would welcome an opportunity of discussing with any legal Government in Rhodesia the future of Rhodesia within the terms of the declaration which we made in this House before Christmas.

Mr. Paget: In view of my right hon. Friend's assurance that it is Her Majesty's Government's intention to retain control of the situation, would he assure us that sanctions could be removed without the consent of the Russians, as permanent Members of the Security Council, and could he say what the procedure for doing this would be?

The Prime Minister: The position is that the sanctions—international sanctions, like our own—were imposed against a situation of a threat to peace arising from a rebellion. They were not associated with any constitutional position, except the unconstitutional position of rebellion; and as soon as the rebellion were to end we would ourselves, nationally, act and, internationally, we would take the initiative in ending the sanctions, which relate only to the period of rebellion.

Mr. Lubbock: Is the Prime Minister aware that on Tuesday the First Secretary told me that he would give favourable consideration to my suggestion that contact should be made and encouragement given to the 3,500 people in Rhodesia who responded to an advertisement in the Rhodesia newspapers calling for implemention of the constitutional changes agreed on H.M.S. "Tiger"? What steps have been taken to give implementation to that?

The Prime Minister: I am sure that it would be the desire of all hon. Members that any of us who is capable of doing so should have friendly relations with those who have shown great courage in the face of possible victimisation, which has been going on there, in public identification with the letter in the Rhodesia Herald. Apart from any contacts which Government representatives might have, I hope that hon. Members visiting Rhodesia in future will make it

their business to have association with all sections of opinion there instead of the, I believe, dangerous concentration which some Members have had with only the extremists there.

Mr. Whitaker: Would my right hon. Friend give a clear assurance that all his future negotiations about Rhodesia will not be with a tiny minority who do not represent Rhodesia but with the leaders of the vast majority of the Rhodesian people, of whom the chief leader is Mr. Nkomo?

The Prime Minister: My hon. Friend knows as well as I do some of the difficulties arising from the divided leadership of African nationalism in Rhodesia, something I saw for myself when I had long discussions with Mr. Nkomo and Mr. Sithole on my last visit there, when it was a question of negotiations since they were in a legal position and when I had discussions with representatives of all sections of opinion, including Mr. Nkomo and Mr. Sithole. So did my right hon. Friend on his recent visit to Salisbury, subject to the veto which Mr. Smith placed on him meeting them. At the meeting on H.M.S. "Tiger", which was of a special character and which was designed to secure a return to constitutional rule, I indicated to Mr. Smith the deSire I had to met Mr. Nkomo and Mr. Sithole, if he would agree to release them to come to this country for that purpose and would agree to let them go back, if they wanted to do so.

Sir Alec Douglas-Home: Is the right hon. Gentleman certain that he was correct in the reply he gave to his hon. and learned Friend the Member for Northampton (Mr. Paget)? Is it not a fact that if, for example, the Russians were to veto the withdrawal of the present resolution, it would stand?

The Prime Minister: That is not our advice in relation to the situation arising where this particular resolution operates under the heading of a threat to peace, the threat having been defined as a continuation of the rebellion. I have made it clear that as far as we are concerned —and this applies to all other countries applying the sanctions—this is against the background of a rebellion and that the sanctions would come to an end when the rebellion comes to an end.

Mr. Michael Foot: Would my right hon. Friend confirm that, whereas it has always been open to the regime in Rhodesia to return to legal rule and whereas presumably that would be for a period under the 1961 Constitution, the absolute principle to which Her Majesty's Government are committed—committed to the United Nations, the Commonwealth, and this House—is that there shall be no grant of independence until majority rule is established?

The Prime Minister: 1 have already made that declaration in the House. It has been confirmed on a number of occasions and it follows from the Commonwealth Conference communiqué. As I have said many times, we had to fight very hard at that Conference—against the fear of a real and dangerous breakup of the Commonwealth—to secure a further period in which we could give Mr. Smith and his colleagues a last chance to return to majority rule. That chance, tragically, was not taken, and, with some of the rumours going around and the pressures being placed on Mr. Smith, I regret that, contrary to what Mr. Smith said to me, he has not had the spunk to stand up to those extremists, despite his great confidence that he could and would do so. As a result of this, he has now been pushed into the very dangerous position of a declaration of a totally illegal and divisive republic.

Mr. Sandys: As the Prime Minister has twice referred to the fact that Rhodesia constitutes a threat to international peace, would he explain how and in what way Rhodesia constitutes such a threat? Does he not know perfectly well that Rhodesia threatens nobody? [Interruption.]

The Prime Minister: This is, of course, an answer which could be given more easily in debate than at Question Time. If I were to give it in debate and if I had long enough to do so, I could not improve on some words used by the right hon. Gentleman in a stiff warning letter he sent to the then Rhodesia Government when he had responsibility, when he acted as though he had responsibility—[Interruption.]—when he said that the matter would inevitably be raised at the United Nations and when he referred to the attitude of the whole Commonwealth and of the surrounding Governments. The

right hon. Gentleman must not get so inebriated with the cheers of his new friends in Trafalgar Square. He should not forget the great sense of responsibility he showed when he had responsibility for this matter.

Several Hon. Members: rose—

Mr. Speaker: Order. I remind the House that we are well past Question Time.

Mr. Biggs-Davison: On a point of order. During these exchanges the Prime Minister kindly referred to a later Question of mine appearing on the Order Paper. In view of that reference, might I have an Answer to that Question, which could be in the form of "Yes" or "No", and be permitted to put a supplementary question?

The Prime Minister: I would naturally consider, in view of what the hon. Gentleman has said, whether to ask your permission to do so, Mr. SPEAKER. However, in the course of my answers to supplementary questions I did answer the hon. Gentleman's Question and I think that he will find that, from his point of view, my answer was slightly better than the "Yes" or "No" he was expecting.

Several Hon. Members: rose—

Mr. Speaker: Order. We cannot go back now.

BUSINESS OF THE HOUSE

Mr. Heath: May I ask the Leader of the House to state the business of the House for next week?

The Lord President of the Council and Leader of the House of Commons (Mr. Richard Crossman): Yes, Sir. The business for next week will be as follows:
MONDAY, 23RD JANUARY—Progress on the Report stage of the Iron and Steel Bill.
TUESDAY, 24TH JANUARY—Further progress on the Report stage of the Iron and Steel Bill, which it is hoped to obtain by seven o'clock.
Afterwards, the remaining stages of the Parliamentary Commissioner Bill.
WEDNESDAY, 25TH JANUARY Consideration of Lords Amendments to the Land Commission Bill.
THURSDAY, 26TH JANUARY—Completion of the remaining stages of the Iron and Steel Bill.
FRIDAY, 27TH JANUARY—Private Members' Motions.
MONDAY, 30TH JANLTARY—The proposed business will be: Supply [7th Allotted Day]:
Debate on a subject to be announced later.
At ten o'clock the Question will be put from the Chair on all outstanding Votes.
As to tomorrow, the House should know that the Industrial Development (Variation of Rate of Grant) Order has been added so that the business then will be:
Second Reading of the Post Office (Borrowing Powers) Bill and of the Export Guarantees Bill.
Motion on the Industrial Development Order.
On quite a different matter, I think the House would like to know that during the course of Mr. Kosygin's visit it is hoped that he will be able to meet Members of both Houses in the Royal Gallery, on Thursday, 9th February.

Mr. Heath: The right hon. Gentleman will recall that he has given undertakings in the past about debates on the White Paper on Transport and the White Paper on Broadcasting and on prison security following publication of the Mountbatten Report. Can he confirm that we are to have debates on those matters? We would like to have them in the comparatively near future. There is also now the question of a debate on the Plowden Committee's Report. Can he assure the House that the Government will provide time for that, and that it will not be too far away?

Mr. Crossman: I think that hon. Member's should have time to digest the Plowden Committee's Report. As to transport, broadcasting and prison security, I think that the last is the most urgent of those and I hope to have an announcement to make in the near future. As for the other two matters, we will bear them in mind. The pledge will be honoured.

Mr. Heath: There is one other point I should like to put to the right hon.

Gentleman. I understand that when the morning sittings begin the public will be admitted only to the Special Gallery and not to the Strangers' Gallery, which will be closed for morning sittings. Surely this is undesirable?—[HoN. MEMBERS: "Hear, hear."] Surely if we are to have morning sittings, ought not members of the public who wish to come in, be allowed in, in so far as capacity allows? Can the right hon. Gentleman say this matter will be looked at?

Mr. Crossman: I expected this. In tact, I have two Questions to answer about it on Monday, and I should like then to deal with this in detail. Perhaps I can anticipate by saying that we are going to arrange accommodation which is normally provided for such non-contentious business later in the evening, and that will be available in the mornings. This temporary expedient is entirely due to the problem of staff here and the number of hours they work.—[HON. MEMBERS: "0h."] I should like to answer this question fully on Monday, if the right hon. Gentleman will allow me.

Mr. Heath: The right hon. Gentleman should realise that this is a very serious matter.—[HON. MEMBERS: "Hear, hear"] Is this a question of staff not being available, or of the Treasury not being able to provide the money to pay the staff? In any case, ought this not to have been thought of and arranged before the Government extended sittings hours?

Mr. Crossman: I will answer this in detail on Monday, but yes, this was thought of, and the Serjeant at Arms very properly informed us of this. The matter has been discussed by the Services Committee at some length and the decision is the result of the Services Committee's discussions.

Mr. Dalyell: Could my right hon. Friend say when he hopes to set up the Science and Technology Committee?

Mr. Crossman: Yes. I hope that both the new specialist Committees, that for agriculture, and that for science and technology, will be at work next week.

Mr. Thorpe: Reverting to the point raised by the Leader of the Opposition, the accommodation for the public, may I ask the right hon. Gentleman to give serious attention to this matter? Is the


right hon. Gentleman aware that the only occasions when the public were excluded from the House were the secret sittings in wartime, which were very exceptional, and that this would be a complete departure from precedent?

Mr. Crossman: The hon. Gentleman would not be right in saying there is any intention to exclude the public. If there were, I entirely agree with him that that would be a grave situation. Nor is there any expectation that the amount of accommodation will be less than required. If it were it would have resulted from a miscalculation by members of the Services Committee.

Mr. Heffer: In view of the serious situation developing in Vietnam, and of the concern which was expressed in the House yesterday, will my right hon. Friend give an assurance that there will be an early debate on the whole question of Vietnam?

Mr. Crossman: I cannot give that assurance to my hon. Friend. I think I am right in saying that we discussed it for a long time on the Adjournment and for half an hour after Question Time yesterday, but unless there is a drastic change in the situation I could not give high priority to another debate.

Mr. Godber: Can the right hon. Gentleman say why he is not taking the Third Reading of the Agriculture Bill next week? It is most discouraging to hon. Members on both sides of the House who have expedited the progress of that Measure.—[Laughter.] Oh, yes. We expedited progress on it and completed the Committee proceedings on it before Christmas and we sat up all night on Tuesday considering it on Report and got the business done. It is most unfortunate that now there is no news of further progress.

Mr. Crossman: I accept the very collaborative frame of mind of the right hon. Gentleman, and I can tell him that I hope to make an announcement on the matter in my business statement next week.

Mrs. Renée Short: Could my right hon. Friend tell us when we shall have an opportunity to discuss the Plowden Report?

Mr. Crossman: As I said to the Leader of the Opposition, I think that we should be wise and would do better to allow time for the digestion of this formidable Report I cannot give any precise indication now when we shall discuss it.

Sir A. V. Harvey: Following the visit of the Secretary of State for Commonwealth Affairs to Malta, may I ask the Leader of the House whether he is aware of the great concern by the friends of Malta and people generally in this country, and in Malta itself, at the treatment being meted out to Malta? Could the right hon. Gentleman arrange for his right hon. Friend at least to make a statement at an early date?

Mr. Crossman: I will certainly communicate to my right hon. Friend the hon. Gentleman's views on the need for a statement.

Mr. Mendelson: Does my right hon. Friend recall that the President of the Board of Trade said just before the Recess that the Government would be willing to arrange for a debate on the Press? Can he say how the Government are proceeding with that arrangement?

Mr. Crossman: Since my right hon. Friend spoke we have had the welcome publication of the formidable Report of the Economist Intelligence Unit. I think that it would be wise to wait to see what the N.P.A. does in response to this very challenging Report before we debate this subject.

Mr. Bryan: Can the right hon. Gentleman say whether the debate on Second Reading of the Marine Broadcasting Offences Bill will come before or after the debate on the White Paper on Broadcasting?

Mr. Crossman: I think that we had better wait. I will make an announcement about broadcasting. It does not arise out of business for next week.

Mr. Roebuck: Does my right hon. Friend recall that just before the Recess it was said, in an Answer to me and when it was known that the Economist Intelligence Unit Report was about to be published, that there would certainly be an early opportunity for a full debate on the Press? Can we look to him to arrange for a debate before some newspaper


closes? Is he aware that a debate has already been arranged in another place? Why should another place have all the best debates?

Mr. Crossman: I do not think that my hon. Friend is quite correct in saying that this statement by the President of the Board of Trade was made when it was known that this Report was to be published. It was known only a recent time ago that it was to be published. Publication of the Report has, I think, fundamentally changed the situation, and we should now wait, I think. The Report is of a very formidable character and I should like to give the Press time to think and do something about it before we discuss it. However, if it were true that a paper were to close, that would be a very different situation.

Rear-Admiral Morgan Giles: Would the right hon. Gentleman ask the Minister of Agriculture to make a statement about foot-and-mouth disease? The Minister has not yet informed the House what steps he has taken to ensure that any future slaughterings will be carried out efficiently and humanely so that there is no suspicion at all of unnecessary suffering and cruelty to animals.

Mr. Crossman: I would have thought that that was a matter which could have been mentioned during the protracted discussions on the Agriculture Bill, but I will certainly pass it on.

Mr. Ellis: Would my right hon. Friend say when the House is to have an opportunity to debate the Third Report of the Estimates Committee on the Meteorological Office?

Mr. Crossman: No, I do not think that I can; but my hon. Friend may anticipate that it will come in the near future.

Mr. Boyd-Carpenter: Reverting to the right hon. Gentleman's statement about the proposed closure of the Public Gallery during the morning sittings, is there any precedent for this, apart from the secret sittings? Does his answer to the Leader of the Liberal Party mean that, if the public turn up in sufficient numbers, he will reverse his decision and

open the gallery, or does he think that there will be so little public interest in the morning sittings that it is not necessary?

Mr. Crossman: I explained this before, but I shall repeat it. We have great problems now, with our officials working very long hours in the day, and the morning sittings will impose further burdens on the staff. In view of that, it was felt that as a temporary measure we should close part of the galleries, on the view, which I think we will find to be correct, that there will be plenty of space for anyone who is likely to attend. We have observed how much attendance we get on this kind of non-controversial business. If it were found that there were people actually excluded, the measures that we are taking to ensure that we have sufficient space would be accelerated. This is a purely temporary measure while extra staff is recruited.

Mr. Frank Allaun: In view of his recent past, the Leader of the House will have read with interest the Report by the Ministry of Housing and Local Government on our older houses. As this intimately affects the lives of 10 million people who are without baths, hot water or inside lavatories, can we have an early debate on this subject, and, better still, Government legislation to implement some of the recommendations in that Report?

Mr. Crossman: I shall not attempt to answer the second part of the question. As to the first part, if the hon. Gentleman can show that there is widespread interest in this very important subject, we can consider it as a possible subject for a debate, as the Report is an extremely important one.

Mr. G. Campbell: Will the Leader of the House give time for a debate on the United Nations so as to provide the Prime Minister with much more time than he had today to explain his interpretation of Article 27 of the United Nations Charter, which provides that decisions of the Security Council on all matters, other than procedural matters, require the concurring votes of all five permanent members?

Mr. Crossman: I will always consider the possibility of a foreign affairs debate.


However, I would remind the hon. Gentleman that on the last occasion when we had a debate, after steady demands for a two-day debate, the number of hon. Gentlemen on the other side of the House who listened to the speech of my right hon. Friend the Foreign Secretary was, I think, 18. We have to calculate the demand for foreign affairs debates partly in terms of reality.

Mr. Winnick: Is my right hon. Friend aware that on this side of the House, though apparently not on the Opposition side, there is a strong desire to have a debate on Vietnam because of the events at present taking place?
Secondly, could he tell us when it is likely that we shall be able to debate the Select Committee's Report on Standing Order No. 9?

Mr. Crossman: 1 have already replied that we are unlikely to have another debate on Vietnam. We had a lengthy discussion at Question Time yesterday, and on the Christmas Adjournment we had a considerable debate. Unless the situation changes substantially, I see no need for another debate on the subject.
I agree that Standing Order No. 9 is an important Order. I shall try to hasten consideration of it and hasten a decision on it as soon as possible.

Mr. Goodhart: Following recent changes in Ministerial responsibilities in the Ministry of Defence, can the Leader of the House now say whether it is proposed to make any change in the traditional form of our forthcoming defence debates?

Mr. Crossman: That is a new point which I am prepared to discuss with my right hon. Friend.

Mr. Michael Foot: Will my right hon. Friend reconsider the answer which he has given to the House about Vietnam? Will he not recognise that there is strong feeling on this side that we should have a debate on the subject before Mr. Kosygin's visit to this country, particularly in view of the fact that there have been grave developments since the debate to which he referred, which reveal that there are heavy civilian casualties in North Vietnam as a result of the bombing, when the Foreign Office at that time was say-

ing to us that there was nothing of the kind?

Mr. Crossman: 1 am always prepared to consider suggestions from my hon. Friend on this subject, as on any other. I will discuss this with the Foreign Secretary. However, I must say to my hon Friend that the chance of devoting the time of the House before 9th February for any debate on the subject would be very small unless he could give me very powerful reasons, which he has not yet done, for changing our minds.

Mr. David Howell: Reverting to the subject of the new Science and Technology Committee, can the Leader of the House assure us that the new committee will have a really effective secretariat, so that it can do a proper job of work?

Mr. Crossman: The problem of staffing of our Select Committees is very acute. I am actively engaged now with the Services Committee in considering the problem of the recruitment of staff.

Mr. Hugh Jenkins: In view of the regrettable failure of my right hon. Friend and the Foreign Secretary to reaffirm the Prime Minister's condemnation of the bombing of Hanoi, can we not have a debate, so that we can go into the matter in greater detail?

Mr. Crossman: I got the impression that this point was made more than once during the exchanges at Question Time yesterday.

Mr. Stodart: Does the right hon. Gentleman not recollect the assurance of high priority which he gave before the House rose on the subject of the Agriculture Bill? Can he assure the House that it is not being elbowed out by other business?

Mr. Crossman: Yes, I can.

Mr. Rankin: Reverting to the subject of Vietnam, my right hon. Friend has said that he needs to be convinced that there is a big demand for such a debate. If we produced a demand with 100 signatures attached to it, would that be a sufficient reason for having a debate on Vietnam?

Mr. Crossman: In view of his own experience, it is not for me to advise my hon. Friend on how to exert pressure on Ministers.

Sir D. Glover: I must ask the right hon. Gentleman to think again about the closure of the Public Gallery during morning sittings. Perhaps the right hon. Gentleman does not spend enough time in the House. In the mornings on Mondays and Wednesdays there are hundreds of people who go over the line of route. They will be deprived of that. Where does the right hon. Gentleman think they will go? Members of Parliament will tell them that they will try to get them into the gallery. It is essential that the full public accommodation is open as soon as morning sittings begin.

Mr. Crossman: I am grateful to all hon. Members who have participated in this discussion. It is something which the Services Committee was actively considering only yesterday. As I have said, there are a number of serious problems involved in the new situation of morning sittings with which we are trying to deal. Certainly, I will bear in mind what has been said. I shall be replying to Questions on Monday, and by then I shall have digested all that has been said by the hon. Gentleman and other Members.

Mr. Molloy: What my right hon. Friend is saying is that, because of the shortage of staff and for other reasons, the ordinary general public part of the Public Gallery may not be open, while the privileged sectors seem to be assured that they will be all right. Will he accept that there are many hon. Members on this side of the House who find that totally repugnant?

Mr. Crossman: I would ask my hon. Friend to wait until I make a full statement, because that is not the intention of the Services Committee. The intention is to admit the general public. We felt —and I think that our calculation is correct—that the amount of space allowed for that purpose would be sufficient. If it were not, I agree that that is something which we could not permit.

Mr. Farr: In view of the disturbing and increasing number of foreign takeovers of industrial concerns in this country, would the right hon. Gentleman arrange for an early debate on the subject?

Mr. Crossman: I do not see the prospect of that happening next week. However if it is a broad subject of that kind it is something which we can discuss through the usual channels.

Mr. Manuel: Is my right hon. Friend aware that the White Paper on Transport was published in July of last year? Is he aware of the growing concern in many local authorities, trade unions and large sections of the public that it should be debated? Now that there is support from hon. Gentleman opposite for my repeated pleas on this subject, can he arrange for a debate in the near future?

Mr. Crossman: I am aware that the demand for such a debate does not come only from the Leader of the Opposition and his supporters, but from our side as well. Clearly, this is a debate which should have priority. and it has been unduly delayed.

Mr. Biffen: Has the right hon. Gentleman's attention been drawn to Motion No. 302, suggesting the annulment of the Salop (No. 2) Order, 1966. Could he confirm that it is his intention that it shall be debated, and say whether or not such a debate might take place next week?

[That an humble Address be presented to Her Majesty, praying that the Salop (No. 2) Order 1966 (S.1. 1966, No. 1529), dated 6th December, 1966, a copy of which was laid before this House on 12th December, be annulled.]

Mr. Crossman: Yes, I know of this Prayer. We ought to leave this to the normal channels to arrange. I can see the point. There are six Prayers of this kind, and I would like to have them discussed through the usual channels. The last thing that I want to do is to suppress the discussion of Prayers.

Mr. Elystan Morgan: Can my right hon. Friend say when a debate can be arranged on the development areas? Does he not agree that it is vitally important for the House to examine as soon as possible the effect of economic policies on those areas with regard to the nature and degree of hardship suffered, and also examine the success or otherwise of policies relating to the channelling of resources and development into those areas?

Mr. Crossman: I will certainly bear my hon. Friend's suggestion in mind.

Sir Knox Cunningham: Can the Leader of the House say why it was necessary to arrange for morning sittings at such an early date that it has not proved practical to allow the public to see them in their gallery? Surely, this is a complete break with all the traditions of the House.

Mr. Crossman: Again, I suggest that the hon. Member awaits my Answers on Monday.

Mr. McNamara: Is my right hon. Friend aware of the important recommendations of the Estimates Committee with regard to the fishing industry? Can he tell us whether we will be able to have an opportunity of an early debate on this matter?

Mr. Crossman: I ought to warn my hon. Friend that an early debate is unlikely, but I will certainly consider the demand.

Sir C. Osborne: In view of the disturbing announcement this morning that national productivity has fallen by 2¼ per cent., making the productivity of the nation now less than at any time in the last two years, and that this and the economic position are likely to get worse, will the right hon. Gentleman arrange for a debate, not on economics generally, but on the question of productivity, because unless this issue is faced everything else will fall? Can we have a debate on the problems of national productivity?

Mr. Crossman: I would not accept the hon. Member's diagnosis, but in view of the tenor of his remarks I would point out that there is a Supply Day on Monday week which could be adequately filled by his demand.

Mr. Judd: Can my right hon. Friend give an assurance that we shall have an early opportunity to discuss the rather disappointing White Paper on Overseas Aid and Development, published during the Recess?

Mr. Crossman: I know that there is interest in this subject and I have seen the Motion on the Order Paper. I will bear this matter in mind.

Mr. Prior: Is the Leader of the House aware that his reply to my hon. and

gallant Friend the Member for Winchester (Rear-Admiral Morgan Giles) about foot-and-mouth disease was most unsatisfactory? Will not the right hon. Gentleman ask his right hon. Friend the Minister of Agriculture to come to the Dispatch Box next week an answer some of the allegations that have been made and reassure the public that nothing of the same sort will ever happen again?

Mr. Crossman: I never want to be discourteous to any hon. Member. What I wanted to suggest was that as agriculture had been under discussion for many hours on Tuesday night and again late last night, it was just possible that the issue could have been raised then—[HON. MEMBERS: "No."]—or directly with the Minister of Agriculture. I have no objection to communicating to my right hon. Friend the wishes of the hon. Member, but I am dealing with the business for next week.

Mr. Gwilym Roberts: In view of the unemployment uncertainties which still exist in the motor industry, and the latest American take-over bid, will my right hon. Friend consider whether he can provide an early debate on the future of this industry?

Mr. Crossman: I have, of course, seen the terms of the early-day Motion, which, I think, my hon. Friend has signed, and it looked to me as though most of the points raised were covered in the very full debate we had in question and answer on Tuesday. If my hon. Friend's suggestion is for a much wider debate on the problems of the industry as a whole, that might be something which we could consider at a later date.

Mr. Edward M. Taylor: In the light of the right hon. Gentleman's assurances before the Recess, can he now say when the Geddes Report on Shipbuilding will be published and debated?

Mr. Crossman: No, I cannot.

Mr. Eyre: Is the Leader of the House aware of the growing concern among the professions at the enormous complexity of the Land Commission Bill and that the Minister concerned was petitioned again this week asking for further postponement of the first appointed day? As the explanatory booklet which was to assist the professions in dealing with


these complexities has still not been issued, will the Leader of the House allocate time next week for this specific issue of postponement to be discussed before it is too late?

Mr. Crossman: It is not for me to advise the hon. Member on how to use his Parliamentary opportunities, but I suspect that without stretching the rules of our Standing Orders on Wednesday, when we shall be considering the Lords Amendments, he might conceivably find it possible to drag in this subject.

Mr. Ridsdale: In view of the apparent queue for Adjournment debates, will the Leader of the House consider finding extra time for debates on the Adjournment? Could we possibly have two a night instead of one?

Mr. Crossman: We are to have them in the morning as well; but I will certainly bear the hon. Member's suggestion in mind.

Mr. Jopling: Reverting to the question of foot-and-mouth disease, does the right hon. Gentleman realise that it is because of matters which were raised on Tuesday night by my hon. Friend the Member for Berwick-upon-Tweed (Viscount Lambton), and again last night, that it is essential that we have a very early statement from the Minister of Agriculture about his intentions concerning the allegations which were made on those occasions?

Mr. Crossman: I am sure that my right hon. Friend—whom the hon Member knows as well as I do is not the kind of

person who shirks discussion or is not prepared to make a statement—will read HANSARD. I will certainly communicate to him the number of hon. Members opposite who feel strongly that a statement is required.

Mr. J. E. B. Hill: Can the right hon. Gentleman give an assurance, on the business to be taken at morning sittings, that he will not include any important agricultural business, because he will be shutting out of the gallery many people from the country who might like to come up and hear it? The right hon. Gentleman may not have realised that quite a lot of visits to London have now had to be postponed or cancelled because constituents cannot go round the whole line of route. They would certainly wish to be able to go into the gallery. Places which would normally be available will not be available for them, but they would particularly like to come if business of interest to the countryside were being taken.

Mr. Crossman: I am not prepared to communicate to the hon. Member any kind of statement about what business we will select for morning sittings and what we will not. Certainly, I will not say that agriculture will never be mentioned at morning sittings. Of course, I appreciate that hon. Members wish, as I wish, the general public to attend more than they do this normal non-controversial business. I am delighted to find this keen interest by the Opposition in attendance at morning sittings. I hope that we shall have the public there on top and the Opposition down below.

Orders of the Day — IRON AND STEEL BILL

As amended (in the Standing Committee), further considered.

New Clause No. 7.—(CONSULTATION ON MATTERS CONCERNING THE EUROPEAN COAI. AND STEEL COMMUNITY.)

(1) The Minister shall keep the Corporation, the publicly-owned companies and such organisations as appear to him to he appropriate and to he representative of the interests of iron and steel producers who are not publicly-owned companies informed—

(a) of the proceedings of the Institutions of the European Coal and Steel Community so far as such proceedings are within his knowledge and appear to him to he relevant to the duties of the Corporation; and
(b) of such other matters concerning the relationship between the United Kingdom and the said Community as in the opinion of the Minister are relevant to the duties of the Corporation and to the iron and steel industry generally.

(2) It shall be the duty of the Corporation to give advice and information to the Minister on any matters relating to their said duties being matters which have been referred by the Minister to the Corporation concerning the relationship between the United Kingdom and the said Community, or being matters which, in the opinion of the Corporation, ought to be taken into account in connection with the said relationship.

(3) Nothing in this section shall be taken as requiring the Minister to disclose to the Corporation or any such organisation as aforesaid any matter which in his opinion it is not in the national interest to disclose to them.

(4) In this section the expression 'the Institutions of the European Coal and Steel Community' means the Institutions mentioned in Article 7 of the Treaty constituting the said Community signed in Paris on 18th April 1951.—[Mr. Barber.]

Brought up, and read the First time.

4.7 p.m.

Mr. Anthony Barber: I beg to move, That the Clause be read a Second time.
During the Committee stage of the Bill a new Clause in similar terms was considered, together with a second new Clause, but, as right hon. and hon. Members who have studied our proceedings will know, most of the discussion was directed to the second of the two new Clauses and the reply of the then Parliamentary Secretary concerning this proposal was. I think most people would

agree, highly unsatisfactory. For this reason, we thought it right to return to the matter on Report.
The purpose of the new Clause can be simply stated. It makes it obligatory on the Minister to inform certain bodies of the proceedings of the European Coal and Steel Community and of certain other relevant matters concerning the relationship between the United Kingdom and the European Community. The bodies to be kept so informed are the National Steel Corporation, the publicly-owned companies and the private sector. I hope that in reply the Minister will not waste the time of the House on technicalities and drafting points, because the purpose of the new Clause is quite clear.
The new Clause is not a cockshy irresponsibly thought up by a small group of Members of Parliament. It is almost identical with Section 4 of the Iron and Steel Act, 1953, and we believe that it is in the national interest that it should he included in the Bill.
When we considered the matter in Committee, the then Parliamentary Secretary adduced two wholly unconvincing reasons for the rejection of the Clause. He said, first, that what it sought to do could be done under the Bill as it stood. That is no answer, because precisely the same observation could have been made of Section 4 of the 1953 Act and about many of the provisions in the Bill. One has only to look, for example, at Clause 3(1,a), where there is set out a duty on the Corporation
to promote the efficient and economical supply by the Corporation … of iron and steel products".
Obviously, if the words had been merely
to promote the … supply … of iron and steel products",
it would still have been open to the Corporation to do it efficiently and economically. The Minister cannot reject this Clause simply on the ground that power to do what is contained in this Clause exists in any event, because there is a further very important difference between accepting the Clause and rejecting it. That is that this new Clause, if accepted, would impose an obligation on the Minister.

Mr. J. J. Mendelson: Is the right hon. Gentleman now suggesting, in referring to Clause 3, that nowhere in


the opening stages of the Bill should there be a statement that it will be the duty of the Corporation to supply iron and steel efficiently? Is it not absurd to say that that was not necessary in a Bill of this kind?

Mr. Barber: The hon. Member has misunderstood the point I am making. What I am saying is that if the words "efficient and economical" had not been included in Clause 3 it would still have been open to the Corporation to supply its products efficiently and economically. There is no obligation in saying that, nevertheless, the Corporation and the Minister could do precisely what is stated in the Clause. We are seeking to impose on the Minister an obligation, precisely the same obligation as was contained in the Iron and Steel Act, 1953, which was then accepted by the House. It has done no harm; but, I believe, a considerable amount of good.
The second reason given by the Parliamentary Secretary for rejection of this Clause was quite puerile. He said that, unlike in 1953, we are now seeking membership of the European Community and, therefore, this provision is unnecessary. Unlike so many hon. Members opposite—including, I suspect, one or two in the Chamber at present—I wish the Prime Minister every success in his efforts to join the European Community, but we are by no means home and dry. We still do not know, for example, how General de Gaulle will react to the unpredictable and unique behaviour of our well-intentioned Foreign Secretary. There are many hurdles to be overcome before we join the European Community.
During other parts of our proceedings the Minister of Power used the argument that we are not yet members of the Community. He used that argument to reject Conservative Amendments which sought to bring the steel industry into line with the European system. Whatever the right hon. Gentleman himself may think about our joining Europe, he cannot have it both ways. If the argument of the Government still is, as it was in Committee, that this Clause is unacceptable because we hope to join the Community, then it becomes highly relevant to consider the effect of the Bill on our chances.
There may be no doubt at all that the nationalisation of steel as contemplated by the Labour Government makes access to the European Coal and Steel Community much more difficult. I say that because the Government's proposals for the iron and steel industry and the particular form of nationalisation which they have selected are incompatible with the policy which is now being followed by the European Coal and Steel Community. That is an incontrovertible fact.
4.15 p.m.
As I have said before, under the Treaty of Paris and the E.C.S.C., ownership of itself is immaterial. There is no argument about that. But the control and the operation of steel enterprises is subject to the most definite requirements. The Government's proposals for the steel industry are without any doubt at all in fundamental conflict with the European system. I must make the point which I made in Committee, that the European system operates on the basis of a variety of individually operated companies, each representing no more than 10 per cent. of the total Community steel capacity.
We have been told quite specifically by the Government that the object of this Bill is to
create a single unit of direction with a capacity of about 30 million tons of crude steel a year.
The new National Steel Corporation would represent about 22 per cent. of the capacity of the combined market of the E.C.S.C. and the United Kingdom, compared with 8 per cent. of the combined market for the largest group at present in the E.C.S.C. The consequence is that if the Government go ahead with the creation of this giant monopoly it will be quite impossible to join the E.C.S.C. without fundamental changes in the Government's policy for the steel industry.
The reason for this is quite simple. Because of the dominant position of the National Steel Corporation, the High Authority of the E.C.S.C. would have power to override the British Minister of Power. The High Authority would actually have the power to fix the prices of British steel and to draw up production programmes for the Corporation. Is that what hon. and right hon. Members opposite want? That certainly is the


factual position. It is right that hon. and right hon. Members and those outside the House of Commons should know precisely what would happen if we were to join the E.C.S.C. and the steel industry were to remain on the lines which have been stated by Her Majesty's Government.
This position is brought about not because the Government intend to nationalise part of the industry. The incompatibility with the European system stems from two facts, first, from the determination of the Labour Government,
to create a single unit of direction with a capacity of 30 million tons of crude steel a year.
and, secondly, from the policy expressed by the present Foreign Secretary that
there is no possibility of going back to real competition."—[OFFICIAL REPORT. 6th May. 1965; Vol. 711, c. 1687.]
So we have the ludicrous position that the Prime Minister is moving towards European integration, whereas his right hon. Friend the Minister of Power is pursuing a policy contrary to the practice of our European friends. Indeed, the Parliamentary Secretary admitted when we considered this matter in Committee that the practice proposed for the National Steel Corporation would require negotiation with the E.C.S.C. That was the understatement of 1966.
I conclude with this plea to the right hon. Gentleman. In these circumstances, it is surely prudent and sensible to include a provision in the Bill which would be advantageous in the unhappy event of the Prime Minister not succeeding in his attempts to join the European Community. I hope that, on reflection, the right hon. Gentleman will agree that this is a useful Clause and will agree to its incorporation in the Bill.

Mr. Nicholas Ridley: I warmly endorse all that my right hon. Friend the Member for Altrincham and Sale (Mr. Barber) has said. The Parliamentary Secretary's argument in Committee to the effect that, as the present circumstances are different from those prevailing at the time of the 1953 Act, the Clause is not needed is an argument which, on closer examination, I find stupefyingly unrealistic. There are only two possibilities—either that we succeed in joining the Community or that we do not. If we are vetoed or excluded,

or if the Prime Minister decides not to let the negotiations proceed, we shall clearly have to go on as before, in which case it is absolutely vital that the Clause be added to the Bill.
On the other hand, if we were to succeed in entering the Community, then perhaps within six months from this date the whole Bill would be completely out of date anyway and would have to be revised. In these circumstances, it is therefore right to include in the Bill a Clause which insists on consultation between the Coal and Steel Community, the Minister and the Corporation.
The Parliamentary Secretary argued that the differing circumstances of the present time meant that all that we sought to do in urging the Minister to take a more European position might even be jeopardised by accepting the Clause. That was an extraordinary statement, because an obligation to consult cannot, and never could, do any harm. I believe that the Minister has recently gone to the Continent to attend a meeting of the High Authority, there not having been a meeting for 18 months previously. I hope that in answering the debate he will tell us exactly how he got on at the meeting and what were the results of any criticisms of the Bill which the High Authority or its servants put up to him.
At various times in Committee we made comments as to what in our opinion will be the main hazards of our joining if the Bill remains in its present form. My right hon. Friend mentioned some. There is the question of the large grouping. There is the question of pricing. There is the question of the commencing capital debt, which will be heavily subsidised by the fact that the compensation payable will be only two-thirds of the value of the assets of the steel companies.

Mr. Speaker: Order. We are getting into a general discussion on the Bill. The hon. Gentleman must come to the new Clause.

Mr. Ridley: I will leave the main objections. As you have rightly said, Sir, they are not within the scope of the Clause.
Before we part with the Bill it is important that the House as a whole is


informed of the High Authority's views on the Bill. It will be no good the Minister saying, after the Bill has been enacted, "We must make some changes in the Bill". We want to know what is involved at this stage.
I am one of those who take a somewhat pessimistic and gloomy view of our chances of success. The present application may not succeed. I hope with all my heart that I am wrong. I earnestly pray that our application will succeed. However, I do not regard this as the end of the story, because, if we were to fail, we would need to reshape all our affairs and to get ourselves into a posture such that the Community at a later date would accept us as a member.
The iron and steel industry is a sector where it is clearly our duty to readjust our affairs, just as it is in agriculture and in other spheres of activity, so that we are prepared, ready and reorganised to join the Community without all these endless negotiations, arguments and fuss. This is what General de Gaulle meant when he vetoed our application last time —"You are not ready". Therefore, it is vital that we take all steps possible to bring the steel industry into such a shape that it does not on a future occasion make it more difficult to join.

Mr. Brian O'Malley: The hon. Gentleman suggests that it may be true that the shape of our steel industry would be one of the factors making our entry difficult, on the ground that the organisation of the industry would be incompatible with the E.C.S.C. Treaty. Is it not true also that the developing organisations of some of the European steel communities within the E.C.S.C. Treaty are incompatible?

Mr. Ridley: I should like to hear the hon. Gentleman substantiate that claim. There are problems, discussions and all sorts of difficulties within the Coal and Steel Community. That only demonstrates the advantages of our being a member. Then we could start to see how we would like it to be changed. We could argue our case and, perhaps, we could prevail. Those remaining outside are in an impossible position to influence the Community.
Whether we like it or not, we must adjust all of our affairs, all of our laws,

all of our practice, and all of our administration, so that we are acceptable. It is after we have joined that we can put our point of view and perhaps succeed in changing the rules or the practice more to our liking. Whether or not we succeed this time, it is a continuing part of policy for the steel industry to align itself to the practice and rules of the European steel industry. Whether we succeed or not, the Clause should be in the Bill. If we succeed, consultation will perhaps be succeeded by membership. If we do not succeed, we have a tremendous task to perform in bringing our steel industry and all sectors of our national life into line.

Mr. Mendelson: The hon. Gentleman is putting forward a very important doctrine which should be clear on the record. Does what he is saying mean that, because we are engaging in a probing operation which the Government hope will lead to negotiations and entry into the Common Market, all the mandate that the Government received from the people at the last General Election must be abandoned forthwith and all the engagements we have undertaken with the electorate must not be proceeded with?

Mr. Speaker: Order. If the hon. Member for Cirencester and Tewkesbury (Mr. Ridley) were to answer that at length, he would be quite out of order.

Mr. Ridley: I will answer it, Mr. Speaker, shortly with the single word, "No". I would hate to stray out of order by answering that lengthy interjection. The argument the hon. Gentleman used can be dealt with by quoting a statement the Minister made in Committee:
I quite understand that there can be argument about whether we should or should not enter the European Economic Community, but it is rather different argument to say that, before we join—if we do—on terms we do not know, our legislation in this country should be tailored to meet that hypothetical situation."—[OFFICIAL REPORT, Standing Committee D: 17th November, 1966, c. 722.]
This is the crux of the difference between those of us who believe that it is vital to be a member of the Community and those rather hesitant hon. Members who will only have it on their own terms. I think I can safely say, as the right hon. Member for Easington (Mr. Shinwell) is


not here, that the majority of the Members in tie Chamber at present are in the first category. It is not a question of seeing whether we can get in from time to time. We must take to heart the lessons of the failures of the past. When we consider the steel industry—

Mr. Speaker: Order. This looks suspiciously like drifting into a discussion about whether we should join the Common Market. The hon. Member must link what he says to this new Clause, which asks that the Government seek contact with the European Coal and Steel Community.

4.30 p.m.

Mr. Ridley: I will conclude by saying that the task of shaping the steel industry to be acceptable to the Coal and Steel Community is one of the great opportunities which the Organising Committee and the Minister will have when the Bill becomes law. To my mind, this is the only really great opportunity in an otherwise miserable exercise. It seems extraordinary, when they are seeking to join, that they have made no effort to ascertain what this means in terms of reorganising our steel industry, and have not written into the Bill the need to consult, and the need to adopt European practice and regulations.
I believe that nobody in Europe or in this country who believes in a wider Europe is satisfied with the Government's attitude. I certainly am not, unless they are prepared to accept this Clause.

Mr. Michael Alison: I support my right hon. Friend the Member for Altrincham and Sale (Mr. Barber), and my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley), on this very important matter. I shall try to stick as closely as I can to the precise terms of the Clause, and address myself particularly to subsections (2) and (3), which relate to the duty of the Corporation to give advice and information to the Minister.
It seems to me that in the Bill we have something of a carte blanche. There are a number of permissive, rather vague, general provisions. For example, there is the new Clause, which we discussed yesterday, about the publication of prices. There is an enormous area still to be covered. There is the whole question of

the pricing system. We cannot but believe that the Government have some very fundamental ideas about pricing. If they do not, certainly the Organising Committee must have, but nothing has been spelled out about this.
There is a whole range of new development which the Organising Committee has to spell out. There is the question of the merging of existing steelworks into larger groups, the question of subdivision specialisation, and so on. There are many things which the Organising Committee, and ultimately the Corporation, will have to put into effect, and all that we are pleading for is the reasonable proposition that it should be obligatory on the Corporation to consider the impact which its proposals are likely to have on the sort of steel industry into which we might have to fit when we go into Europe.
It is self-evident that as things stand now there are considerable differences between the pricing system in this country, and the broad principles governing that of the Coal and Steel Community. Its fundamental guide lines are nondiscrimination, and what is technically known as transparency, that is, the possibility of all buyers and consumers knowing precisely all the terms and conditions of all sellers. The Community has the necessity of the basing point system of publication of prices. We regard it as essential that the Organising Committee should consider the system in operation on the Continent before it decides what system to devise in this country.
We know that the British steel industry as it exists now has given some thought to an E.C.S.C.—like pricing system. There is its zonal plan, with the idea of somehow compensating for the rather shorter hauls that we have in this country, and the absence of published freight rates, and so on. Ideas like this have been bruited around, but we want to make certain, by the acceptance of this Clause, that the Committee will consider what is going on on the Continent, and keep the Minister informed about the relationship between its proposals and those into which we might have to fit if we go into Europe.
I am particularly concerned about the way in which the pricing system will work, especially with regard to some of the ramifications of transport charges. This


will be one of the most interesting comparisons between the way in which we shall have to develop if we go into Europe, and the way in which the European system works.

Mr. O'Malley: Will the hon. Gentleman explain why the Opposition are so eager to introduce into this country a system of pricing which does not work on the Continent? One useful result could be achieved by passing that kind of information to the British steel industry, if it does not already know it. It should be told that the system in Europe is not working. Why should we have a system which has broken down elsewhere?

Mr. Alison: The hon. Gentleman seems repeatedly to argue that, simply because the Community has met with difficulties in remarkable circumstances, these difficulties will exist when circumstances change. At the moment, the Community is facing, difficulties not dissimilar to those with which the British steel industry is having to contend. There is a considerable softening of the market.
This does not mean that the whole system has been torpedoed. Difficulties are being experienced in Europe, but it is not certain that they are insurmountable. In fact, I think that they will be surmounted. I know that there are many new tendencies there, such as cartelisation, and so on. They are considering the major proposals in Germany to merge 31 firms into four big groups. We do not know what the results will be, but I believe that the principles of the Coal and Steel Community, namely, nondiscrimination, transparency, and competition, will be preserved.
The Community will be able to preserve the principles on which the original project was based, even though there may be variations in detail—import protection, extension of the money margins, and so on. It is not certain that all this will be torpedoed. These problems will assuredly be solved on the Continent. If they could get the Coal and Steel Community into existence under post-war conditions, they will be able to adapt it to meet present conditions, and we want to make sure that the British steel industry conforms in broad terms with the sort of pattern which is likely to emerge on the Continent.

Mr. O'Malley: We have an opportunity within the British steel industry to organise a pricing system on the basis of the experience gained from the Continent. De novo, we in this country have the opportunity of developing a system which could be the envy of Europe, and which Europe might want to follow.

Mr. Alison: I agree that we should consider developing something if we are starting a new pattern which will be fresh and novel, but I urge the Minister and the hon. Member for Rotherham (Mr. O'Malley) to bear in mind the fact that the future prosperity of the British steel industry will lie largely in exporting, and in operating in larger markets.
If the hon. Gentleman thinks that he can solve and evolve a British steel industry pricing system within the context of the United Kingdom market, with a growth rate which is negative, if not actually static, and with a utilisation capacity of 75 per cent., and that we can build it up into a self-contained operation in this island, he is mistaken. We must consider what is happening in Europe, and in fact all over the world, because that is where we will have to trade. They will try to push their products into this country, and we will have to try to push ours into theirs.

Mr. Ridley: If we develop a sensible pricing system, as the hon. Member for Rotherham (Mr. O'Malley) suggests, it will help if the Clause is accepted, because it will enable the Europeans to find out all about it from us.

Mr. Alison: I take the point made by my hon. Friend. We want there to be an awareness of what is going on. We want that sort of attitude of mind. We want a recognition which was noticeably left out by the Prime Minister in his original announcement that he meant when he talked about going into Europe. There seems to be a lack of awareness that the Treaty of Paris, as well as the Treaty of Rome, are part and parcel of what we shall have to adapt ourselves to, and what the Government will have to adapt themselves to. This is quite different from the problem of British agriculture. We have had an enormous amount of discussion about the adaptation of Britain in terms of agricultural change, but that is nothing like as serious as the adaptation necessary in terms of British steel, but nobody mentions that fact.

Mr. R. E. Winterbottom: I am rather puzzled—

Sir Gerald Nabarro: The hon. Member is always puzzled.

Mr. Winterbottom: —as to the point at which in our negotiations for entry into the Community there will be discussions about anything in the Bill before us, or how the hon. Member arrives at the conclusion that the prices difficulty will affect negotiations for entry into that body, when most of these things are unknown at present. Is not it a figment of his imagination?

Mr. Alison: I am not sure whether or not the hon. Member for Sheffield, Brightside (Mr. Winterbottom) had been laid low by the time we reached this subject in Committee, but he will recollect that one of the most important discussions was about the prices at which the assets of the steel industry would be taken over.

Mr. Winterbottom: I heard what was said then, but that was a different matter.

Mr. Alison: If the hon. Member is right in his claim that he was not sick al the time, it is plain that he was rapidly sickening. It is self-evident that some of the provisions of the Bill will profoundly sour the prospect of a successful application by the United Kingdom to enter the Common Market—especially the power to reduce prices of exports by reason of the lower capital debt which the Corporation will be saddled with when it takes over. The general attitude of mind that we want to reassert and re-emphasise continually is that when we come face to face with President de Gaulle across the conference table—which the Prime Minister will presently have to do—the President will not be concerned about what is written even into the Treaty of Rome, let alone the Treaty of Paris. He will not really be concerned with what is written into some of the Schedules and minor parts of the Bill. What he will be concerned with, as he was at the time of the Polaris deal, when he discussed the question of our accession with Mr. Macmillan, is the general trend of imports on Britain's accession.
We believe that it is crucial for the Prime Minister and the Government to realise that if the Common Market is to digest the biggest single monolithic steel-

producing unit, representing over 20 per cent. of total steel production in Europe, it is incumbent upon the Government to lean over backwards to show that in everything they propose in connection with any change in the British steel industry they will have some cognisance of the impact it will have on the Continent, and the way in which we shall be able to fit our steel industry into this complex in a constructive and productive way. It is on this matter that we want the Minister to give us a reasonably fair hearing.

Sir G. Nabarro: The right hon. Gentleman was in Luxembourg on Friday, 13th January, 1967. I preceded him by 48 hours, no doubt considering many of the points that he had been considering and consulting various people that he had consulted about the difficult and delicate matter of the impact of steel nationalisation upon Britain's tentative approach to entering the European Economic Community. The new Clause is concerned only with measures for consultations. I shall not stray very far into Common Market economic and financial arguments, but I must preface my remarks in that context by pronouncing my own view in clear and unmistakable terms, which is that the nationalisation of the British steel industry is totally and utterly incompatible with membership of the European Coal and Steel Community.

4.45 p.m.

The Minister of Power (Mr. Richard Marsh): At the moment, as hon. Members know, statements like that which the hon. Gentleman has just made could be unhelpful to the sort of thing that we want to achieve. I ask him to clarify the point that he has made. He was in Luxembourg and the High Authority was there at the time. Can he name a single official of the High Authority who expressed the view that he has just put forward?

Sir G. Nabarro: Yes, and I will come on to a verification of my views—

Mr. Deputy Speaker (Sir Eric Fletcher): The hon. Member ought not to do that. He has said that the economics of our joining the European Community are not in order on the Clause, and he is right. He has prefaced his remarks by indicating his general


belief, and it would be quite wrong to pursue that matter any further.

Sir G. Nabarro: I shall not be tempted by the right hon. Gentleman. There will be future opportunities to answer him, and I am never short of opportunities in these matters. I prefer Mr. Speaker to have ants in his pants when he is listening to my speeches—metaphorically speaking.
I now return to the issue of consultation. My hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) quoted from one of the earlier debates in Committee, and I want to quote part of the debate that is the nub of the matter in regard to consultation. The Parliamentary Secretary to the Ministry of Technology, answering the Common Market consultation debate, said:
That actual arrangements made with the High Authority in 1954 were, of course, met by an exchange of letters between the right hon. Member for Streatham (Mr. Sandys) and the then President of the High Authority, and the Government certainly intend to reopen negotiations in order to bring this exchange of letters up to date. In particular, the Government intend to propose to the High Authority that as from vesting date the Iron and Steel Board member of the Council of the Association should be replaced by a member of the National Steel Corporation. I say that in answer to the hon. Member for Worcestershire. South."—[OFFICIAL REPORT. Standing Committee D. 15th December. 1967, c. 2453.]
I claim that consultation in the form stipulated in the quotation is entirely inadequate for our needs. The British steel industry, whether in private hands or nationalised, is intimately concerned with the steel industry of Western Europe, and it is significant that although hon. and right hon. Gentlemen opposite often decry the efficiency of our steel industry in private hands, it has, notwithstanding intense world competition, maintained during the last few years its share of world markets for export, excluding consumption in this country. Does the hon. Member for Ebbw Vale (Mr. Michael Foot) challenge this?

Mr. Michael Foot: The leading company in this country in the export of British steel is the publicly-owned company of Richard Thomas and Baldwins.

Sir G. Nabarro: Richard Thomas and Baldwins have lost £12 million in the last two years. It is the only British steel company to lose money—no doubt aided and abetted by the hon. Member for Ebbw Vale (Mr. Michael Foot).

Mr. John Nott: Does my hon. Friend agree that if steel companies such as Richard Thomas and Baldwins were to charge prices below world prices, thus sustaining large losses, it would then not be very difficult for them to maintain export levels?

Sir G. Nabarro: I agree with my hon. Friend the Member for St. Ives (Mr. Nott). Penetration by British steel firms over the tariff wall into Europe at cut prices is likely to bring retaliation from the Community. I would want consultation for that and for many other reasons.
I want to return to the intervention of the hon. Member for Ebbw Vale. Britain has maintained its share of world markets. The Benson Report quotes percentages of 12·7 in 1956, 12·5 in 1960 and 12·2 in 1964—the last published figure. The European Coal and Steel Community, excluding inter-trading, shows figures for 1956 of 53·1 per cent; 1960, 54·7 per cent.; 1964, 42·8 per cent.
So Britain and the European Coal and Steel Community between them had in 1964 55 per cent. of world export markets for steel and the only—[Interruption.] The hon. Member for Ebbw Vale is abysmal in his ignorance of the principal industry in his constituency. He should go back to Ebbw Vale and learn the economics of steel. He was better placed in Plymouth, among the West Countrymen talking about strawberries, celery, cucumbers and tomatoes. I will deal with the hon. Gentleman in a moment.
I repeat—55 per cent. of the world steel export markets are shared between the West European Community and Britain and we are holding our world markets. The very thin, tenuous link of consultation between this important Community and the nationalised British industry, we are told, according to the quotation from Committee, is to be a single member of the Corporation. That is all. He will be answerable to the Minister and it is doubtful whether we shall be able to extract more information from the Minister about the activities
of the Community through the single British representative on it, a member of the Corporation, than the information extracted from the right hon. Gentleman on the evening of Friday, 13th January, 1967, at London Airport, when questioned by the B.B.C.—

Mr. Marsh: Which right hon. Gentleman?

Sir G. Nabarro: The Minister of Power.

Mr. Marsh: I am very sorry. On the evening of the 13th of this month, I was, in fact, in Luxembourg. I was not in London Airport—

Sir G. Nabarro: The following day, then.

Mr. Marsh: On the following day, I was in Paris—

Sir G. Nabarro: On his way home then; the right hon. Gentleman is splitting hairs.

Mr. Marsh: If I may pursue the point, at no time was I interviewed by the B.B.C. or any other broadcasting organisation.

Sir G. Nabarro: As I listened to the right hon. Gentleman's comment on the B.B.C., which was innocuous, nasal and poorly delivered, I am sure that I am not mistaken in this matter.
I now want to turn to the major issue raised by my right hon. Friend the Member for Altrincham and Sale (Mr. Barber)—the dominant position which would be occupied by the British steel industry, if nationalised, and if Britain were successful in joining the Common Market, inevitably involving us in signing the Treaty of Paris.
What the hon. Member for Ebbw Vale does not understand is that, out of 110 million ingot tons of steel produced in the Common Market, only 7·4 million are produced by a nationalised undertaking, and that is a part of the Italian steel industry. The other 93 per cent. is privately owned. If Britain goes in, with her nationalised steel industry with a capacity of 30 million ingot tons, that would bring the total to something more than 20 per cent. of the total capacity of the Common Market and would be utterly unacceptable to the High Authority.
It is for that reason that the consultation ought now to be strengthened. The hon. Member for Ebbw Vale challenged the respectability of my remarks in this matter, as to why this consultation should be strengthened at this point and why a nationalised British steel industry is incompatible with our entry into Europe. I can give the respectable support for my comment. The hon. Gentleman will know, as a representative of a steel-making constituency—South Worcestershire does not make any steel, but I have spent much of my life in association with the steel industry in a non-political context—

Mr. Archie Manuel: Impossible.

Sir G. Nabarro: If the hon. Member wants to say something, perhaps he would rise and say it.

Mr. Manuel: I was not referring to the hon. Gentleman himself being impossible, but I was saying that it was impossible for him to be non-political.

Sir G. Nabarro: The characteristic of the hon. Member for Central Ayrshire (Mr. Manuel) is to absent himself from the Chamber for long periods and, in his infrequent incursions into the Chamber, to remain sedentary and shout at speakers on this side. I deplore his habits.
I now quote the respectable support for my view. The hon. Member for Ebbw Vale, as a representative of a steel-making constituency, will, of course, know the journal Steel International.—

Mr. Winterbottom: indicated assent.

Sir G. Nabarro: I am glad that the hon. Member for Sheffield, Brightside (Mr. Winterbottom) recognises it. The hon. Member for Ebbw Vale has never read it, evidently. Had he read the issue for November-December, he would have found these pregnant words in full and unequivocal support for what I have already said to the House:
Once so effective and so promising, the E.C.S.C. is now going through a very bad patch. In the emergency, it has been suggested that its High Authority should be vested with executive rights of sanction. It should invoke its special reserve powers to limit steel output.


This is why consultation at this minute is so important.
It is at this threatening juncture that the British Government has resolved to carry the country into the European Economic Community, and the British steel industry, by the same token, into the E.C.S.C. From a narrow point of view, there are many, in a different political camp from Mr. Harold Wilson and his friends, who would consider such a departure fortuitously very fortunate. A completely State owned and controlled steel industry would be incompatible with membership of the E.C.S.C. The Labour Government's proposed National Steel Corporation would not rank for entry. As an out-and-out State dependency it would have no place in the steel scheme of things in the E.E.C. When Mr. Edward Heath was essaying to get Britain into the Common Market, some years back, it came out that, in the event of his success, the Iron and Steel Board would have to go. It just would not fit in with the proposed new arrangements.
That joining the E.E.C., and thus the European Coal and Steel Community would put at naught"—
This is the answer to the hon. Member for Penistone (Mr. Mendelson)—
the Labour Government's plans for taking over the British steel industry may or may not already have been considered by Mr. Harold Wilson and his friends and advisers. On the score that the lesser must be sacrificed to the greater, it would he a handy way of giving up these plans and still saving face'.
for the Labour Government—

Mr. Winterbottom: I, too, read that article—

Sir Douglas Glover: On a point of order. Hon. Members opposite apparently have no intention of making speeches for themselves, but seem to intervene in nearly every speech from this side. Would it not be better for them to make their own contributions instead of constantly intervening?

Mr. Deputy Speaker: No, that is not a point of order. If the hon. Member Who is addressing the House chooses to give way, it is in accordance with the traditions of the House.

Sir G. Nabarro: For fear that I should lose control of the Floor, I would utter a few words. I now give way to the hon. Member for Brightside.

Mr. Winterbottom: In respect of the article from which the hon. Gentleman quoted, I respectfully point out that it was by a contributor and did not express either the official or the unofficial

opinion of the High Authority. It is not only an opinion of the contributor, but also an opinion largely shared in steel circles on the Continent by the authors of Le Plan Professionel, which has dominated the French steel industry for some time. This ought to be explained completely to get the full impact of what the hon. Member is saying.

Mr. Deputy Speaker: Order. We cannot pursue this topic on this particular Amendment. We must confine the debate to the merits of the exchange of information.

5.0 p.m.

Sir G. Nabarro: I am deeply grateful to have your support, Mr. Deputy Speaker, as so many of these interventions from hon. Members opposite are irrelevant.
I was asked for public support for my statement that nationalised steel in this country was incompatible with—

Mr. Deputy Speaker: Order. I have said that we cannot pursue that subject in this debate.

Sir G. Nabarro: I shall not pursue it, Mr. Deputy Speaker. I have quoted what I wanted to quote. It is not an opinion; it is commentary in a journal editorial, and a very valid one, too.
I conclude my comments by saying that it would be wise to strengthen our consultative links with the European Coal and Steel Community at the earliest date. The present arrangements are totally inadequate. The new Clause would greatly strengthen this consultative machinery, and for that reason I hope that my right hon. and hon. Friends will, if necessary, press this matter to a Division.
No doubt, we shall be opposed by Labour Members who are faithful to the nostrum, the shibboleth, the sacred cow of steel nationalisation, but I have succeeded in my purpose. Not only is consultative machinery essential, in the most intimate sense, between the European Coal and Steel Community and the British Iron and Steel Corporation, but the underlying factor has now been powerfully brought out in this debate that nationalised steel in Britain is utterly incompatible with the Prime Minister's efforts to enter Europe.

Mr. R. Gresham Cooke: I want to make one point which


has not been fully brought out in the debate so far. The greatest problem at present facing the steel industries of the world, and particularly the steel industries of Europe and this country, is overcapacity. We have falling production, and only about 70 per cent. or perhaps under 70 per cent. of our steel capacity is being used. Equally, there is a great problem in Europe at present, and, of course, also in America. Yet we have plans in this country for plunging ahead. The Government may well have plans for increasing our capacity from 27 million to 35 million tons, or figures like that, in the next seven to ten years.
That is the kind of policy that the Labour Government would love to follow, because their criticism of the steel industry over the years has always been that it has not increased its capacity fast enough. In the 1960s, in response to thoughts of that kind, the steel industry increased its capacity very greatly, yet today in Sheffield and in other centres it is having to put men off because of over-capacity, and the production is not now required.
This is a problem that will face us very strongly in Europe. That is why I would like to see the very closest links between ourselves and Europe. What is the point of Europe going ahead and increasing capacity and our doing the same? I support this new Clause because it is so important at this moment to improve our links with Europe and to have the closest consultation; otherwise we shall find our steel industry with great over-capacity in the next few years, with consequent unemployment.

Mr. J. Bruce-Gardyne: I support this most important new Clause. I hope very much that the Minister will accept it as it seems to me to be of considerable psychological importance.
When a similar Clause was discussed in Committee, the Parliamentary Secretary to the Ministry of Technology, who has now unfortunately left us again after his brief appearance, gave rather insubstantial reasons for rejecting it. The most substantial appeared to be that,
To make such provisions with reference to one particular subject on which the relations between the Minister and the Corporation would have to be developed would be to suggest that other subjects on which the Minister will be dealing with the Corporation are in

some way less important."—[OFFICIAL REPORT, Standing Committee D, 15th December, 1966; c. 2453.]
I can think of few subjects at present which are more important than the nature of our relationship with the European Community, which all of us on this side of the House at least, and some hon. Members on the other side, are hoping to join.
As several of my hon. Friends have already pointed out, the mere introduction of this Bill has immeasurably complicated and reduced the prospect of our entry into the European Community. I am afraid there is no doubt about this. My right hon. Friend the Member for Altrincham and Sale (Mr. Barber) pointed out in Committee, and the Parliamentary Secretary to the Ministry of Technology did not dispute it in replying to the debate, that in the High Authority's interpretation, the size of the National Steel Corporation would be far in excess of the 10 per cent. of the market which the High Authority considers acceptable. The Parliamentary Secretary simply said:
The way in which the High Authority from time to time chooses to interpret the provisions of the Treaty is a matter for negotiation."—[OFFICIAL REPORT, Standing Committee D, 15th December, 1966; c. 2455]
To my mind, this is to dismiss the objection rather lightly. This is one of the many matters on which the Front Bench opposite have some learning to do in the months ahead if they mean serious negotiation.
The other objection which the Parliamentary Secretary to the Ministry of Technology raised to the similar Clause in Committee was that it was not really necessary anyway, because at this time we hoped to enter the European Community ourselves. It is true that, if we are successful in our approach to the European Community, then, obviously, the need for the form of consultation which the Clause is designed to achieve disappears. But I am bound to tell the Minister, having returned last week from Paris, and having had a number of discussions with some of the senior French officials most closely involved, that I regard the chances of this hope being realised during the course of the coming months, or at all under the present Administration, as remote. I regret to say that, but I think it is true. If this


negotiation fails—and it will fail because, basically, the Prime Minister lacks credibility as a European—

Mr. Deputy Speaker: Order. I have said that we cannot pursue in this debate the merits of the negotiation about joining the European Community. We can discuss only the desirability of the new Clause dealing with consultation.

Mr. Bruce-Gardyne: I entirely accept that, Mr. Deputy Speaker. My point in making that statement was that at a time like this it is essential that we demonstrate our European credibility, and the new Clause is designed to do precisely that.

Mr. Peter Kirk: There is a further point. If my hon. Friend is correct in his forecast, and I am afraid he is, this consultation becomes absolutely vital.

Mr. Bruce-Gardyne: I am grateful to my hon. Friend. I was coming to that. It is the second barrel of support for the new Clause. The first barrel is that it would be a psychological gesture, so to speak, a demonstration that we are thinking and the Government are thinking in European terms, and—heaven knows—this is needed urgently. For that reason above all, I hope that the Minister will accept the new Clause. There is no reason why he should not.
As my hon. Friend the Member for Saffron Walden (Mr. Kirk) has just pointed out, the second leg of the argument is that if, as I fear, the negotiation fails, the provisions of the new Clause will become absolutely vital. We shall then be outside the European Community for another two or three years until right hon. Gentlemen opposite have departed. We must be in a position to resume the negotiation successfully under a different Government, and we must in the interval maintain the closest possible consultation with the Coal and Steel Community.
I shall not go over the arguments about the need for consultation between the National Steel Corporation and the Coal and Steel Community which have already been admirably put by my hon. Friends. But I have one question to put to the Minister. If he is determined to resist the

Clause, will he explain precisely how consultation between the National Steel Corporation and the Coal and Steel Community is to be effectively assured? We have had no proper answer to that question either in Committee or in the brief and occasional interruptions from the benches opposite today.
I emphasise the great psychological importance of the new Clause. Whatever the Minister's feeling about our approach to the European Community may be and whatever the well known feelings of his hon. Friends may be, the country as a whole regards it as vital that the negotiations should succeed. He should, therefore, accept a new Clause of this kind which can only help the negotiation to succeed.

Mr. Noft: When I saw the right hon. Gentleman the Member for Leyton (Mr. Gordon Walker) sitting on the Government Front Bench yesterday and also this afternoon, I was mindful of his new function as general Cabinet co-ordinator of the Government's chaos. In the context of this debate, the nationalisation of steel, on the one hand, and our entry into the Common Market, on the other, we see the utter lack of co-ordination within the Government. This is the main reason why the new Clause should be accepted now. Consultation on the relationship between the High Authority and the National Steel Corporation is vital, whether we enter the Common Market by the current negotiations or not.
The answers we had from the Minister yesterday to new Clauses 1 and 4, on pricing policy and on competition, were very depressing to us. To the High Authority they would be absolute anathema. If the Minister imagines that the answers which he gave would be beneficial to our entry, he is in need of the very information which the new Clause seeks to provide, information from the Corporation on the facts of life regarding the relationship between the High Authority and ourselves.
If we took our steel industry into the Common Market as one grouping, this country would produce 22 to 25 per cent. of its total output of steel. So far as I am aware, there is not at present a single producer within the Common Market under one control producing more than 8 or 9 million tons. Therefore, if we


succeed in entering the Common Market, it will be essential for the groupings within our industry to be not more than of the order of 10 million tons or so. It is fundamental to the principles of the Treaty of Paris that no company shall possess such a concentration of power as to make competition meaningless. The Phoenix Rheinruhr Thyssen merger was, I understand, held up by the High Authority for nearly two years principally because the combined companies would have had an output of about 8 million tons, yet we are talking here about our total output of about 30 million tons.

5.15 p.m.

Mr. Winterbottom: The French steel industry has recently completed the first part of a reorganisation which gives a much bigger output in many of the French steel factories—in fact, it has been subsidised by the French Government—yet this has not been challenged by the High Authority. I suggest that the hon. Gentleman is speaking from hopeful imagination rather than from full knowledge of the facts.

Mr. Nott: I am not aware of the actual output of individual factories in the French steel industry, but I am quite sure that, from the point of view of control, which is what we are talking about here, there is no one French grouping under one control producing more than 10 million tons. If I am wrong, perhaps the hon. Gentleman will give me its name.
The hon. Member for Rotherham (Mr. O'Malley) referred earlier, as did my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro)—this raises another reason why consultation is essential —to the Italian steel industry. Although the Italian nationalised steel industry produces about 8 million tons, it is not under the sort of control which our industry will be under if the Bill goes through. Italsider and Finsider, the two Government controlled Italian steel companies have a substantial element of public shareholding in them, so that even to that extent they are dissimilar from what our National Steel Corporation would look like. Apart from that, even if one were to take in Fiat and the other Italian producers in addition to Italsider and Finsider, still the output of steel in Italy as

a whole would not amount to more than 12 million tons, yet we are talking here of our national output under one control of 30 million tons. The Italian steel industry, therefore, bears very little resemblance to what ours would look like were the Bill to go through.
We have discussed pricing policy and competition, two fundamentals within the Common Market, where there must be market transparency and re-alignment to competitive prices. These points do not seem to have been taken yet on the benches opposite. In addition, there is the whole question of the commencing capital debt of the Corporation, which was mentioned earlier. There is a strong probability that the High Authority will regard the substantial discount on asset value at which the Government are buying the steel companies as a hidden subsidy. [Laughter.] The hon. Member for Brightside (Mr. Winterbottom) may laugh, but that is true. When the Minister draws up a pro forma balance sheet of the National Steel Corporation, there will be a surplus on consolidation of about £350 million which can be used to write off the assets of the National Steel Corporation. If that takes place, the depreciation charged annually in the accounts of the National Steel Corporation will be about £25 million less, which will enable the prices of the steel products to be substantially reduced even further below the prices which now prevail in the Common Market. Therefore, this is just one other reason why we consider the new Clause to be vitally necessary. It does not appear to us that adequate consultation is taking place at present, that the relationship between the high authority and this country is being adequately regarded. For that reason, and in the context of the current negotiations, we very much hope that the Minister will accept the Clause.

Mr. Michael Shaw: I rise only to assure the right hon. Gentleman that we would like a different reply from that which we had in Committee. We do not believe that to say that the conditions are now different because we are actually negotiating with a view to getting into the Common Market is an adequate objection to the introduction of the Clause, or a similar Clause.
Has the Minister any specific objections to its wording? Are there any aspects of it to which he takes objection? Are there any parts of it which he would not in any case carry out, whether or not the Clause became part of the Bill? All we are trying to do is to ensure that what he regards as good and normal practice will be carried on when he is no longer in his present position. I am sure that he would think that to be very reasonable. Such Clauses have been operated in the past with success and with benefit, and should be carried on in the future.

Mr. Marsh: This has been an interesting debate for a number of reasons. Every hon. Gentleman opposite who has spoken has expressed his undying desire to see Britain's entry into the European Economic Community, and has given a long list of reasons why the Government's practices would disqualify it from membership. One hon. Gentleman opposite even gave us an insight into conversations he had in Paris recently, in which he discussed these very problems which face British entry. They might well have complained if at the time the last Government was attempting to negotiate—I say "attempting" because they were dreadfully unsuccessful—Labour Members had been carrying on discussions with foreign Governments on the impediments to British entry.

Mr. Bruce-Gardyne: I hope that the right hon. Gentleman will withdraw that disgraceful and totally unjustified statement. What I was discussing in Paris and trying to find out was the conditions on which the French Government might regard Britain as acceptable, and I took every opportunity to state the great importance of British entry from the point of view of both Britain and France.

Mr. Marsh: I am not attempting to be controversial, because there is now complete unanimity between both sides of the House. Her Majesty's Government are now committed to examining the possibility and implications of British membership of the European Economic Community. That is what hon. and right hon. Members opposite want. All I am am saying is that if there are groups of people in Europe who do not want British entry into the Community and

who would look for reasons and arguments as to why Britain should not enter, they would find a pretty good case by just reading this afternoon's debate word for word. Hon. Members must have their own standards about these things and decide which is the best way of obtaining British entry.

Mr. Ridley: Does the Minister remember that when the last application was made speech after speech and attack after attack against the whole principle came from his party?

Sir D. Glover: And the Minister.

Mr. Ridley: Will the right hon. Gentleman compare that with the massive support he is now receiving from this side of the House to try to help him achieve his Government's policy?

Mr. Marsh: I am merely commenting on the discussion which has taken place. I think the whole argument has been that the Bill as it stands makes British entry into the European Economic Community difficult to well-nigh impossible. There is another argument which follows and which as my hon. Friend the Member for Penistone (Mr. Mendelson) has pointed out, is very important. That is the significant argument as to how far the Government, engaged in negotiations, should go in drawing up its legislation now in the terms of rules laid down by organisations of which it is not a part, which have rules for their own convenience and in which the Government have no say.
I should have thought that the Government at the moment must embark on legislation designed to meet the purposes they regard as necessary for the welfare of the British economy and people generally. If subsequently they proceed to negotiate with the Community for British entry there will be a number of problems to settle. That is what negotiation is all about. When one negotiates one works on the assumption that one has something to offer the other chap and tries to work out an arrangement which will suit both parties. One does not argue that one has no right to views of one's own.
The suggestion that there is something indecent in our drawing up a Bill which will present difficulties for entry is an


extraordinary constitutional argument. It is a problem closely aligned with that of whether the dangers of failure are so high that the need to have contingency planning and the circulation and obtaining of information on this become a matter of argument. Hon. Gentlemen opposite say that the present position is so dangerous and difficult that we must have contingency planning on the assumption that we might not get in.

Mr. Barber: That is not our case. The case was that it is the simplest thing in the world for the right hon. Gentleman to accept the Clause. That would have saved an hour's debate and we could have got on with the real business.

Mr. Marsh: I do not think that that is so. For example, any of these national organisations present difficulty when one joins an international community. It is no secret that the National Coal Board presents difficulties. The Coal Board presented difficulties last time, and the Iron and Steel Board presented difficulties. When the party opposite was in office the then Minister of Power, the right hon. Member for Bridlington (Mr. Wood) said in answer to a supplementary Question:
The position is that these powers,"—
of the Iron and Steel Board—
…are clearly incompatible with the treaty of Paris."—[OFFICIAL REPORT, 3rd December, 1962; Vol. 668, c. 932.]
The Government then did not wind up the Board as a result. They assumed that this was something they would have to argue.

Mr. O'Malley: Is it not also true that the proposals put forward by the British Iron and Steel Federation on the eve of the Second Reading of the Bill were also incompatible with the Treaty?

Mr. Marsh: I do not think that there is any doubt that the Iron and Steel Board is incompatible with the Treaty as it stands. The Federation's proposals for a sort of high authority within the industry at that time would also have been a matter of great difficulty. I accept that the Bill also presents difficulties. In exactly the same way the National Coal Board presents difficulties.
I was in Luxembourg at this time last week to discuss with the European Coal

and Steel Community our mutual problems. I led a delegation including the Chairman of the National Coal Board and some of his officials. We discussed reports drawn up after discussions between the European Coal and Steel Community and officials of the Coal Board. We had with us the Chairman of the Iron and Steel Board, sir Cyril Musgrave, who also had his officials with him. All the reports were presented to the Council of Association as joint reports —on the one hand an official of the High Authority and on the other an official of the National Coal Board or the Iron and Steel Board.
Therefore, very close and real consultation exists. When the hon. Member for Worcestershire, South (sir G. Nabarro) says that we cannot live in isolation from the Continent and that what we do in terms of steel is affected by what the Continent does, he is right. Nobody disputes it for a moment; it would be absurd to do so. That is why we have this close and continuing consultation.

5.30 p.m.

Mr. Nott: Is it not true to say that in the new Clauses that were debated yesterday and in this new Clause all that the Opposition are seeking is recognition on the part of the Minister of the problems of pricing policy, competition and so on which exist? That is all that we are basically seeking recognition of. But so far the Minister has not agreed with any of these points.

Mr. Marsh: I can assure the hon. Member that when negotiations begin there will be so many people who will be prepared to point out all the difficulties to us that we do not need the Opposition to join in as well. We know what the difficulties are; everybody does.
The first point, therefore, is that the consultation takes place.
The second point is that there were two other items on the agenda for the meeting with the European Coal and Steel Community which hon. Gentlemen opposite want to write into the Bill and which I suggest are already in the Bill. These items were placed on the agenda as a result of submissions by the British. One item concerned world steel prices. The meeting decided to set up a continuing collaboration between officials from


Britain and officials of the High Authority. This is no exchange of circulars. It is an active working together between officials of the High Authority and the British Government. The second item on the agenda—

Mr. Patrick Jenkin (Wanstead & Woodford): With regard to that first item, would not the right hon. Gentleman agree that what he and his officials were engaged on in Luxembourg in that connection was regulating international trade to provide a cosy home market at the expense of export opportunities, which is what his predecessor accused the industry of in the debate on 9th November, 1964?

Mr. Marsh: Hon. Gentlemen opposite started this, arguing that they wanted collaboration with the European Coal and Steel Community. The first attempt to get that collaboration has been welcomed by the European Coal and Steel Community and by British industry, and now the first sour note is sounded by one of the official spokesmen of the Opposition.
The second item on the agenda—placed there at our request—was the nationalisation of the British Iron and Steel industry. We discussed this in specific terms with the High Authority. In that discussion not one member of the High Authority raised any suggestion that the nationalisation of the British iron and steel industry was a factor which would prevent Britain joining the European Economic Community, and no one made any speech at any time which had anywhere near the degree of difficulty and virulence to be found in the speeches from the Opposition benches. [Interruption.] I am stating a fact. All that I am saying can easily be checked. I do not make mis-statements in public. The arguments and difficulties raised in this House are not raised when one meets foreigners who are involved in these matters.

Sir G. Nabarro: As the Treaty of Paris in this matter is absolutely explicit as to the 10 per cent. clause, and as the British nationalised steel industry would represent more than 20 per cent., then if no objection was raised in Luxembourg presumably it means that the Prime Minister will be able to dictate to General

de Gaulle that the Treaty of Paris is scrapped if we go in.

Mr. Marsh: I suggest that when the hon. Gentleman wishes to quote a document he should bring a copy of it with him. The words of the Treaty of Paris—

Sir G. Nabarro: The right hon. Gentleman cannot read it all.

Mr. Marsh: No, but I can read the part that is important, and then when he has got time the hon. Member can read the rest of it himself.
The part that I propose to quote refers to the question of size, and size of itself is no more a barrier to British entry than ownership of itself is. This is Article 66. It states that:
the High Authority is empowered to address to public or private enterprises which, in law or in fact, have or acquire on the market for one of the products subject to its jurisdiction a dominating position which protects them from effective competition in a substantial part of the common market, any recommendation required to prevent the use of that position for purposes contrary to those of this Treaty.
The argument is not the question of size of itself. It is a difficult and complex series of negotiations, and the way in which the organisation operates is one of the factors.

Sir G. Nabarro: The right hon. Gentleman is not correct.

Mr. Marsh: If the hon. Gentleman is correct, it will be an unusual experience for him, and he should enjoy it.
Let me deal with the position that we already face. Of course, the British steel industry under public ownership will be larger than any Continental competitor. But the production of the National Coal Board at the moment is equal to the production of the whole of the Six. The Corporation's production will represent only one-quarter of the combined steel production of the United Kingdom and the Six. I am dealing with this matter only because it was raised at such length by so many hon. Members opposite, and my purpose is to say, to begin with, that there is nothing in the Iron and Steel Bill which prevents British entry into the European Community. If Britain does not join the European Economic Community, whatever the reason is, it certainly will not be because of the Iron and Steel Bill.
I turn now to some of the specific reasons for not accepting the new Clause.

Mr. Alison: The right hon. Gentleman said "there is nothing in the Bill". There is nothing in the Bill about the future shape or pattern of the British steel industry. This is being left to the Organising Committee. One of the provisions in the new Clause is to suggest that the Minister should write in the need for this consultation between the Corporation and himself vis-à-vis Europe. Of course he could not discuss it with the Europeans, because he does not know what the facts are going to be.

Mr. Marsh: I am grateful for that intervention. The point made by the right hon. Member for Altrincham and Sale (Mr. Barber) was fair, that proposals of this type appeared in the Iron and Steel Act, 1953. But the position here is very different. The position of the Corporation is quite different from that of the Iron and Steel Board. The position of the Corporation is much more similar to that of the National Coal Board than to that of the Iron and Steel Board.
As was said earlier by my colleague who is now the Parliamentary Secretary to the Ministry of Technology, it is my intention to have consultations with the High Authority with a view to amendment of the exchange of letters between the right hon. Member for Streatham (Mr. Sandys) and the then President of the High Authority, and to propose that as from vesting day a member of the Corporation shall become an actual member of the Council of Association.
We have had a debate of a certain length—I will not say a long one. This is a subject about which I know hon. Gentlemen opposite feel strongly. If the intention is that the British nationalised steel industry should have close and continuing contacts and consultations with the European Coal and Steel Community, those are taking place now on specific issues. I am surprised that hon. Gentlement opposite did not know this. It is inconceivable that they should not take place. How could we possibly talk about our own problems of surplus capacity without having such discussions?

Mr. Ridley: Why not accept the new Clause?

Mr. Marsh: The hon. Gentleman keeps asking why I do not accept the new Clause. It would be pointless to put into the Bill statements about everything that we already do and that everybody else knows that we do, and that is taken without argument, anyway. Also, we do not want the Corporation to have the same relationships with European Coal and Steel Community as the Iron and Steel Board, because it is a different body from the Iron and Steel Board. It should be recognised that the Corporation is a body —not just a Government agency, but a commercial undertaking—which is operating and has consultations with the European Coal and Steel Community in its own right. This is, of course, what the Corporation will do.
Our relationship with the European Coal and Steel Community is a very important subject. A belief that any British Government would or could, in or out of the Common Market, act independently of those on the Continent is fallacious. If there is any belief in the House that whether we enter or do not enter the Common Market will be determined on the basis of the nationalisation of iron and steel, that, too, is fallacious.
On the surface, the new Clause is simple, calling for the circulation of information and for consultations. But information is already circulated and the consultations already take place. I recognise the right of the Opposition to raise what they want to raise, whether they embarrass the Government or not, but it is unfortunate perhaps at this stage that we had to have this debate, related not merely to consultation but including a long and exaggerated catalogue of difficulties which, it is claimed, the Bill presents to British membership of the Common Market.

Mr. Barber: I am not surprised that the Minister's speech was testy, because he is very conscious of the fact that what he is doing, not only in this Bill but in his statements, about the future organisation of the industry is incompatible with the European system and will make the Prime Minister's task of getting into Europe just that much more difficult. That is why he so carefully skated round the arguments put by my hon. Friends and myself and singularly failed to answer the criticisms made.
The right hon. Gentleman started by saying that all the speakers on the Opposition side wanted to get Britain into the Common Market. He could not say that of his own supporters. I suppose I shall be told that I am making life more difficult for the Prime Minister in his negotiations if I point out that at least 50 or 60 or 100 or more hon. Members opposite do not want us to enter the Common Market.
To any Labour Left-wingers who happen to be present—most seem to have gone for the moment—I would say that their substantial objections to joining the Common Market will not affect the negotiations at all. They may have talked incessantly in debate, but never have they marched to take action against the Prime Minister. The result is that, whatever the Prime Minister wants to do, we can be sure that all the Left-wingers will go into the Lobby on this score with him and maintain their £3,000 a year salaries. That is the truth.
The right hon. Gentleman then said that he objected to my hon. Friends exposing the obstacles to our entry into Europe. How naive can he become? Does he think that the leaders of industry and politics in Europe have not a clue about the obstacles and do not understand them and that it is unpatriotic for anyone on this side or any leader writer in any newspaper to discuss the obstacles? This is as ridiculous as the Foreign Secretary used to be when debating economic affairs, saying that when we said anything reflecting badly on the economy we were "knocking sterling". He spoke as though people abroad did not know what the state of the economy was. My hon. Friends were right to raise the points they did.
5.45 p.m.
The right hon. Gentleman then uttered a significant sentence. He said that he accepted that the Bill presented difficulties. That was an interesting admission, because it confirmed the basis of what we had been saying. The Minister is deliberately embarking on a course which will make it more difficult for us to join Europe. What are people on the Continent to think of a Government who, on the one hand, seek to join the Common Market while, on the other,

put forward domestic policies which will not make it easy for us to join?

Mr. Marsh: If negotiations take place all these issues will have to be negotiated. There is no difference between this Measure and the Measure which nationalised the coal industry in this respect. [Interruption.] This is a serious matter. The country is engaged in major international negotiations, and it is not unusual that a Minister should be allowed to say a few words on the subject. There is no specific point in this Bill which would prevent the entry of Britain into the Common Market. It produces the same sort of points which will have to be negotiated as, for example, the National Coal Board or any other concentration of industry of this type.

Mr. Barber: Perhaps in support of what I am saying I can quote another unpatriotic source, the Financial Times, of 23rd November, 1966. An article then stated:
Some stiffening in the powers of the High Authority of the E.C.S.C. (which was set up, like the Steel Board in Britain, in conditions of steel scarcity) is probable, and this will be greatly complicated by the presence of the huge National Steel Corporation; unless the N.S.C. takes the form of three or four competing and largely autonomous groups, it could become an important stumbling block to Britain's entry into the Community.
I suppose that Mr. Geoffrey Owen, the Industrial Editor of the Financial Times, will also be thought unpatriotic. Presumably it will also be said that he should not have raised this question now.
I did not say that the Bill or nationalisation as such were obstacles to our entry into Europe. I said that the expressed proposals for the organisation of the steel industry put forward by the right hon. Gentleman, his predecessor and the present Foreign Secretary, who is now going around Europe, without any doubt are in conflict with the European system. Of that there is no doubt.
I gave the figures. The right hon. Gentleman can talk to anyone in the E.C.S.C. and they will not deny what I have said. The right hon. Gentleman quoted from Article 66 of the Treaty of Paris. That was very interesting, for he did not quote the last few lines of the paragraph. This is something that will be of considerable interest to hon. Members opposite in particular. We all know that the phrase "dominant position" as


at present interpreted by the E.C.S.C. means something over 10 per cent., although it may change its practice. We would have 22 per cent. of the market if the Bill goes through as it is and the industry is organised as the right hon. Gentleman proposes. We would have a dominant position. This would not prevent us joining the E.C.S.C., but what would follow? I will quote the passage, missing out certain words which are not relevant in this context:
…the High Authority is empowered to address to public or private enterprises which…have a dominant position which protects them from effective competition in a substantial part of the common market"—
the United Kingdom is certainly a substantial part—
any recommendations required to prevent the use of such position for purposes contrary to those of this Treaty. If such recommendations are not carried out satisfactorily within reasonable time, the High Authority willȆfix the prices and conditions of sale to be applied by the enterprise in question, or draw up production or delivery programmes which it must fulfil.
That is significant. We can sign the Treaty of Paris and join the E.C.S.C. and have this great monolithic organisation that the right hon. Gentleman wants and which was advocated by his predecessor and the present Foreign Secretary. We can have all these things, but of course it will be not the Minister of Power but the High Authority of the E.C.S.C. which will fix the prices and the conditions of sale and draw up the delivery programmes for the British steel industry. If that is what hon. Members opposite want, all I can say is that I do not go along with them.
The final comment of the right hon. Gentleman was a complaint against my hon. Friend the Member for Wanstead and Woodford (Mr. Patrick Jenkin). The right hon. Gentleman complained because my hon. Friend had quoted a passage from a speech in a previous debate by the right hon. Gentleman's predecessor, who is now somewhere in the Department of Economic Affairs. The interesting thing about that is that when he was in Luxembourg a short time ago, according

to all the newspapers—and he never denied this—the right hon. Gentleman raised the question of a world steel conference, and he was applauded for doing so. The industry was delighted and we were all delighted, and we all thought that it was a very good thing.

But the right hon. Gentleman's predecessor, now somewhere in the Department of Economic Affairs, when Minister of Power, said:
The industry's attitude is exemplified by its demands for a world steel conference which would not…be concerned with reducing tariffs and increasing trade, but with regulating international trade to provide a cosy home market at the expense of export opportunities." [OFFICIAL REPORT, 9th November, 1964; Vol. 701, c. 683.]

It was not my hon. Friend who was doing a disservice to Britain and the British steel industry, but the right hon. Gentleman's predecessor when he made that speech in 1964. I do not expect him to do it, but if the right hon. Gentleman had to comment on that speech, he would, of course, immediately dissociate himself from it, because it was a scandalous thing to say at that time.

I have not gone over again the points which I raised when I moved the new Clause. I have dealt with the arguments of the right hon. Gentleman. I conclude by saying that we entirely reject his complaint against us on this side of the House, or anyone else who writes articles, or who speaks in the country and who sees fit to raise in public the obstacles to our entry into Europe and who seeks to educate the right hon. Gentleman, the Prime Minister and the rest of the Government to do the right thing if they genuinely want to get into Europe. The right hon. Gentleman did not deal with the substance of my speech in moving the new Clause. What he said was wholly unsatisfactory and I therefore advise my right hon. and hon. Friends to divide the House.

Question put, That the Clause be read a Second time:—

The House divided: Ayes 226, Noes 305.

Division No. 236.]
AYES
[5.55 p.m.


Alison, Michael (Barkston Ash)
Batsford, Brian
Birch, Rt. Hn. Nigel


Allason, James (Hemel Hempstead)
Beamish, Col. Sir Tufton
Black, Sir Cyril


Astor, John
Bell, Ronald
Blaker, Peter


Atkins, Humphrey (M't'n A M'd'n)
Berry, Hn. Anthony
Body, Richard


Balniel, Lord
Bessell, Peter
Bossom, Sir clive


Barber, Rt. Hn. Anthony
Biggs-Davison, John
Boyd-Carpenter, Rt. Hn. John




Boyle, Rt. Hn. Sir Edward
Harrison, Col. Sir Harwood (Eye)
Onslow, Cranley


Braine, Bernard
Harvey, Sir Arthur Vere
Orr, Capt. L. P. S.


Brewis, John
Harvie Anderson, Miss
Orr-Ewing, Sir Ian


Brinton, Sir Tatton
Hastings, Stephen
Osborn, John (Hallam)


Brown, Sir Edward (Bath)
Hawkins, Paul
Osborne, Sir Cyril (Louth)


Bruce-Gardyne, J.
Hay, John
Page, Graham (Crosby)


Bryan, Paul
Heald, Rt. Hn. Sir Lionel
Page, John (Harrow, W.)


Buchanan-Smith, Alick(Angus, N&amp;M)
Heath, Rt. Hn. Edward
Pearson, Sir Frank (Clitheroe)


Buck, Antony (Colchester)
Heseltine, Michael
Peel, John


Bullus, Sir Eric
Higgins, Terence L.
Percival, Ian


Burden, F. A.
Hill, J. E. B.
Peyton, John


Campbell, Gordon
Hirst, Geoffrey
Pink, R. Bonner


Carlisle, Mark
Hobson, Rt. Hn. Sir John
Pounder, Rafton


Carr, Rt. Hn. Robert
Hogg, Rt. Hn. Quintin
Powell, Rt. Hn. J. Enoch


Cary, Sir Robert
Holland, Philip
Price, David (Eastleigh)


Channon, H. P. G.
Hordern, Peter
Prior, J. M. L.


Chichester-Clark, R.
Hornby, Richard
Quennell, Miss J. M.


Clark, Henry
Howell, David (Guildford)
Ramsden, Rt, Hn. James


Clegg, Walter
Hunt, John
Rawlinson, Rt. Hn. Sir Peter


Cooke, Robert
Hutchison, Michael Clark
Renton, Rt. Hn. Sir David


Cooper-Key, Sir Neill
Irvine, Bryant Godman (Rve)
Ridley, Hn. Nicholas


Costain, A. P.
Jenkin, Patrick (Woodford)
Ridsdale, Julian


Craddock, Sir Beresford (Spelthorne)
Jennings, J. C. (Burton)
Roots, William


Crawley, Aldan
Jones, Arthur (Northants, S.)
Rossi, Hugh (Hornsey)


Crosthwaite-Eyre, Sir Oliver
Joseph, Rt. Hn. Sir Keith
Royle, Anthony


Crouch, David
Kerby, Capt. Henry
Russell, Sir Ronald


Crowder, F. P.
Kershaw, Anthony
St. John-Stevas, Norman


Cunningham, Sir Knox
Kimball, Marcus
Sandys, Rt. Hn. D.


Currie, G. B. H.
King, Evelyn (Dorset, S.)
Scott, Nicholas


Dalkeith, Earl of
Kirk, Peter
Sharples, Richard


Dance, James
Kitson, Timothy
Shaw, Michael (Sc'b'gh &amp; Whitby)


Davidson, James(Aberdeenshire, W.)
Knight, Mrs. Jill
Sinclair, Sir George


Dean, Paul (Somerset, N.)
Lambton, Viscount
Smith, John


Deedes, Rt. Hn. W, F. (Ashford)
Lancaster, Col. C. G.
Stainton, Keith


Digby, Simon Wingfield
Langford-Holt, Sir John
Steel, David (Roxburgh)


Dodds-Parker, Douglas
Legge-Bourke, Sir Harry
Stodart, Anthony


Doughty, Charles
Lewis, Kenneth (Rutland)
Summers, Sir Spencer


Douglas-Home, Rt. Hn. Sir Alec
Lloyd, Ian (P'tsm'th, Langstone)
Taylor, Sir Charles (Eastbourne)


Drayson, G. B.
Lloyd, Rt. Hn. Selwyn (Wirral)
Taylor, Edward M.(G'gow, Cathcart)


du Cann, Rt. Hn. Edward
Longden, Gilbert
Taylor, Frank (Moss Side)


Eden, Sir John
Loveys, W. H.
Teeling, Sir William


Elliot, Capt. Walter (Carshalton)
Lubbock, Eric
Temple, John M.


Eyre, Reginald
McAdden, Sir Stephen
Thatcher, Mrs. Margaret


Farr, John
MacArthur, Ian
Thorpe, Jeremy


Fisher, Nigel
Mackenzie, Alasdair (Ross &amp; Crom'ty)
Tilney, John


Fletcher-Cooke, Charles
Maclean, Sir Fitzroy
Turton, Rt. Hn. R. H.


Forrest, George
Macleod, Rt. Hn. Iain
van Straubenzee, W. R.


Fortescue, Tim
Macmilln, Maurice (Farnham)
Vaughan-Morgan, Rt. Hn. Sir John


Foster, Sir John
Maddan, Martin
Vickers, Dame Joan


Fraser,Rt.Hn.Hugh(St'fford &amp; Stone)
Maginnis, John E.
Wainwright, Richard (Colne Valley)


Gibson-Watt, David
Marples, Rt. Hn. Ernest
Walker, Peter (Worcester)


Gilmour, Ian (Norfolk, C.)
Marten, Neil
Walker-Smith, Rt. Hn. Sir Derek


Gilmour, Sir John (Fife, E.)
Maude, Angus
Wall, Patrick


Glover, Sir Douglas
Maudling, Rt. Hn. Reginald
Walters, Dennis


Glyn, Sir Richard
Mawby, Ray
Ward, Dame Irene


Godber, Rt. Hn. J. B.
Maxwell-Hyslop, R. J.
Weatherill, Bernard


Goodhart, Philip
Mills, Peter (Torrington)
Webster, David


Goodhew, Victor
Mills, Stratton (Belfast, N.)
Wells, John (Maidstone)


Grant, Anthony
Miscampbell, Norman
Whitelaw, Rt. Hn. William


Grant-Ferris, R.
Mitchell, David (Basingstoke)
Wills, Sir Gerald (Bridgwater)


Gresham Cooke, R.
Monro, Hector
Wilson, Geoffrey (Truro)


Grieve, Percy
More, Jasper
Winstanley, Dr. M. P.


Griffiths, Eldon (Bury St. Edmunds)
Morgan, Geraint (Denbigh)
Wood, Rt. Hn. Richard


Grimond, Rt. Hn. J.
Morrison, Charles (Devizes)
Worsley, Marcus


Gurden, Harold
Mott-Radclyffe, Sir Charles
Wylie, N. R.


Hall, John (Wycombe)
Munro-Lucas-Tooth, Sir Hugh
Younger, Hn. George


Hall-Davis, A. G. F.
Murton, Oscar



Hamilton, Marquess of (Fermanagh)
Nabarro, Sir Gerald
TELLERS FOR THE AYES:


Hamilton, Michael (Salisbury)
Neave, Airey
Mr. Pym and Mr. R. W. Elliott.


Harris, Reader (Heston)
Nicholls, Sir Harmar



Harrison, Brian (Maldon)
Nott, John





NOES


Abse, Leo
Bacon, Rt. Hn, Alice
Binns, John


Albu, Austen
Bagier, Gordon A. T.
Bishop, E. S.


Allaun, Frank (Salford, E.)
Barnes, Michael
Blackburn, F.


Alldritt, Walter
Barnett, Joel
Blenkinsop, Arthur


Allen, Scholefield
Beaney, Afan
Boardman, H.


Anderson, Donald
Bellenger, Rt. Hn. F. J.
Booth, Albert


Archer, Peter
Bence, Cyril
Boston, Terence


Armstrong, Ernest
Benn, Rt. Hn. Anthony Wedgwood
Bottomley, Rt. Hn. Arthur


Atkins, Ronald (Preston, N.)
Bennett, James (G'gow, Bridgeton)
Boyden, James


Atkinson, Norman (Tottenham)
Bidwell, Sydney
Braddock. Mrs. E. M.







Bradley, Tom
Hamilton, James (Bothwell)
Moyle, Roland


Bray, Dr. Jeremy
Hamling, William
Murray, Albert


Brooks, Edwin
Hannan, William
Neal, Harold


Broughton, Dr. A. D. D.
Harper, Joseph
Newens, Stan


Brown, Rt. Hn. George (Belper)
Harrison, Walter (Wakefield)
Norwood, Christopher


Brown, Hugh D. (G'gow, Provan)
Hart, Mrs. Judith
Oakes, Gordon


Brown, Bob(N'c'tle-upon-Tyne, W.)
Haseldine, Norman
O'Malley, Brian


Brown, R. W. (Shoreditch &amp; F'bury)
Hattersley, Roy
Oram, Albert E.


Buchan, Norman
Hazell, Bert
Orbach, Maurice


Buchanan, Richard (G'gow, Sp'burn)
Heffer, Eric S.
Orme, Stanley


Butler, Herbert (Hackney, C.)
Henig, Stanley
Oswald, Thomas


Butler, Mrs. Joyce (Wood Green)
Herbison, Rt. Hn. Margaret
Owen, Dr. David (Plymouth, S'tn)


Callaghan, Rt. Hn. James
Hilton, W. S.
Owen, Will (Morpeth)


Cant, R. B.
Hobden, Dennis (Brighton, K'town)
Paget, R. T.


Carmichael, Neil
Hooley, Frank
Palmer, Arthur


Carter-Jones, Lewis
Horner, John
Pannell, Rt. Hn. Charles


Chapman, Donald
Houghton, Rt. Hn. Douglas
Park, Trevor


Coe, Denis
Howarth, Harry (Wellingborough)
Parker, John (Dagenham)


Coleman, Donald
Howarth, Robert (Bolton, E.)
Parkyn, Brian (Bedford)


Concannon, J. D.
Howie, W.
Pavitt, Laurence


Conlan, Bernard
Hoy, James
Pearson, Arthur (Pontypridd)


Corbet, Mrs. Freda
Hughes, Rt. Hn. Cledwyn (Anglesey)
Peart, Rt. Hn. Fred


Craddock, George (Bradford, S.)
Hughes, Hector (Aberdeen, N.)
Pentland, Norman


Crawshaw, Richard
Hughes, Roy (Newport)
Perry, Ernest G. (Battersea, S.)


Cronin, John
Hunter, Adam
Perry, George H. (Nottingham, S.)


Crosland, Rt. Hn. Anthony
Irvine, A. J. (Edge Hill)
Prentice, Rt. Hn. R. E.


Crossman, Rt. Hn. Richard
Jackson, Peter M. (High Peak)
Price, Christopher (Perry Barr)


Cullen, Mrs. Alice
Jay, Rt. Hn. Douglas
Price, Thomas (Westhoughton)


Dalyell, Tam
Jeger, George (Goole)
Price, William (Rugby)


Darling, Rt. Hn. George
Jenkins, Hugh (putney)
Probert, Arthur


Davies, Dr. Ernest (Stretford)
Johnson, Carol (Lewisham, S.)
Pursey, Cmdr. Harry


Davies, G. Elfed (Rhondda, E.)
Johnson, James (K'ston-on-Hull, W.)
Randall, Harry


Davies, Harold (Leek)
Jones, Rt. Hn. Sir Elwyn(W.Ham,S.)
Rankin, John


Davies, Ifor (Gower)
Jones, J. Idwal (Wrexham)
Redhead, Edward


Davies, Robert (Cambridge)
Judd, Frank
Reynolds, G. W.


Davies, S. O. (Merthyr)
Kelley, Richard
Rhodes, Geoffrey


Delargy, Hugh
Kenyon, Clifford
Roberts, Albert (Normanton)


Dell, Edmund
Kerr, Dr. David (W'worth, Central)
Roberts, Goronwy (Caernarvon)


Dempsey, James
Lawson, George
Roberts, Gwilym (Bedfordshire, S.)


Dewar, Donald
Leadbitter, Ted
Robertson, John (Paisley)


Diamond, Rt. Hn. John
Lee, Rt. Hn. Frederick (Newton)
Robinson, Rt. Hn. Kenneth(St.P'c'as)


Dickens, James
Lestor, Miss Joan
Robinson, W. O. J. (Walth'stow, E.)


Dobson, Ray
Lewis, Arthur (W. Ham, N.)
Rodgers, William (Stockton)


Doig, Peter
Lewis, Ron (Carlisle)
Roebuck, Roy


Driberg, Tom
Lipton, Marcus
Rogers, George (Kensington, N.)


Dunn, James A.
Lomas, Kenneth
Rose, Paul


Dunnett, Jack
Loughlin, Charles
Ross, Rt. Hn. William


Dunwoody, Mrs. Gwyneth (Exeter)
Luard, Evan
Rowland, Christopher (Meriden)


Dunwoody, Dr. John (F'th &amp; C'b'e)
Lyon, Alexander W. (York)
Rowlands, E. (Cardiff, N.)


Eadie, Alex
Lyons, Edward (Bradford, E.)
Ryan, John


Edelman, Maurice
Mabon, Dr. J. Dickson
Shaw, Arnold (Ilford, S.)


Edwards, Rt. Hn Ness (Caerphilly)
McCann, John
Sheldon, Robert


Edwards, Robert (Bilston)
MacColl, James
Shinwell, Rt. Hn. E.


Edwards, William (Merioneth)
Macdonald, A. H.
Shore, Peter (Stepney)


Ellis, John
McCuire, Michael
Short, Rt. Hn. Edward (N'c'stle-u-Tyne)


English, Michael
McKay, Mrs. Margaret
Short, Mrs. Renée(W'hampton,N.E.)


Ennals, David
Mackenzie, Gregor (Rutherglen)
Sllkin, Rt. Hn. John (Deptford)


Ensor, David
Mackie, John
Silkin, Hn. S. C. (Dulwich)


Evans, Albert (Islington, S.W.)
Mackintosh, John P.
Silverman, Julius (Aston)


Evans, loan L. (Birm'h'm, Yardley)
Maclennan, Robert
Silverman, Sydney (Nelson)


Fernyhough, E.
MacMillan, Malcolm (Western Isles)
Skeffington, Arthur


Fitch, Alan (Wigan)
McMillan, Tom (Glasgow, C.)
Slater, Joseph


Fletcher, Raymond (Ilkeston)
McNamara, J. Kevin
Small, William


Fletcher, Ted (Darlington)
MacPherson, Malcolm
Snow, Julian


Foley, Maurice
Mahon, Peter (Preston, S.)
Spriggs, Leslie


Foot, Sir Dingle (Ipswich)
Mahon, Simon (Bootle)
Steele, Thomas (Dunbartonehire, W.)


Foot, Michael (Ebbw Vale)
Mallalieu, E. L. (Brigg)
Stonehouse, John


Ford, Ben
Mal1alieu, J.P.W.(Huddersfield, E.)
Strauss, Rt. Hn. G. R.


Forrester, John
Manuel, Archie
Swain, Thomas


Fowler, Gerry
Mapp, Charles
Taverne, Dick


Fraser, John (Norwood)
Marquand, David
Thomas, George (Cardiff, W.)


Fraser, Rt. Hn. Tom (Hamilton)
Marsh, Rt. Hn. Richard
Thomson, Rt. Hn. George


Freeson, Reginald
Mason, Roy
Thornton, Ernest


Galpern, Sir Myer
Mayhew, Christopher
Tinn, James


Gardner, Tony
Mellish, Robert
Tomney, Frank


Garrett, W. E.
Mendelson, J. J.
Tuck, Raphael


Ginsburg, David
Mikardo, Ian
Urwin, T. W.


Gourlay, Harry
Millan, Bruce
Varley, Eric G.


Gray, Dr. Hugh (Yarmouth)
Milne, Edward (Blyth)
Wainwright, Edwin (Dearne Valley)


Greenwood, Rt. Hn. Anthony
Mitchell, R. C. (S'th'pton, Test)
Walker, Harold (Doncaster)


Gregory, Arnold
Molloy, William
Wallace, George


Grey, Charles (Durham)
Moonman, Eric
Watkins, David (Consett)


Griffiths, Rt. Hn. James (Llanelly)
Morgan, Elystan (Cardiganshire)
Watkins, Tudor (Brecon &amp; Radnor)


Gunter, Rt. Hn. R. J.
Morris, Alfred (Wythenshawe)
Weitzman, David


Hale, Leslie (Oldham, W.)
Morris, John (Aberavon)
Wellbeloved, James







Whitaker, Ben
Williams, Clifford (Abertillery)
Woodburn, Rt. Hn. A.


White, Mrs. Eirene
Williams, Mrs. Shirley (Hitchin)
Woof, Robert


Whitlock, William
Williams, W. T. (Warrington)
Wyatt, Woodrow


Wigg, Rt. Hn. George
Willis, George (Edinburgh, E.)
Yates, Victor


Wilkine, w. A.
Wilson, Rt. Hn. Harold (Huyton)



Willey, Rt. Hn. Frederick
Wilson, William (Coventry, S.)
TELLERS FOR THE NOES:


Williams, Alan (Swansea, W.)
Winnick, David
Mr. Charles R. Morris and


Williams, Alan Lee (Hornchurch)
Winterbottom, R. E.
 Mr. McBride.

New Clause No. 9.—(ESTABLISHMENT OF TRIBUNAL.)

(1) The Minister shall by regulations provide for the establishment of a Tribunal to determine—

(a) applications by companies not coming into public ownership to restrain the Corporation or any publicly-owned company from engaging in any such discriminatory practices as are described in section 3(1)(b) of this Act;
(b) appeals by companies not coming into public ownership against the terms of any notice published under section 13(2) of this Act or served under section 36(2) of this Act.

(2) If the applicant satisfies the Tribunal that the Corporation or any publicly-owned company has engaged in such discriminatory practices as are described in section 3(1)(b) of this Act, the Tribunal shall so determine and publish its findings and the reasons for its findings and so report to the Minister and to the applicant and to the Corporation, and the Minister and the Corporation shall give effect to the determination.

(3) If the applicant satisfies the Tribunal that the terms of the notice published under section 13(2) of this Act, or served under section 36(2) of this Act would affect the appellant unfairly, the Tribunal shall so determine and publish its findings and the reasons for its findings and the Minister shall give effect to its determination.

(4) The Minister and the Corporation and the publicly-owned companies shall provide the Tribunal with all such information and other assistance as the Tribunal may reasonably require for the proper performance of their functions —[Sir J. Hobson.]

Brought up, and read the first time.

Sir John Hobson (Warwick and Learnington): I beg to move, That the Clause be read a Second time.
The purpose of the new Clause is to provide for the setting up of an independent tribunal which can decide in three different and separate situations between the citizen, on the one hand, who considers that he has been unfairly and unjustly treated or adversely affected and, on the other hand, either the Corporation and the Minister whom he blames for these events. It is not suggested that the proposed tribunal should have any power to award damages or to give any legal remedy. It would simply report and publish its findings and reasons. Either the Corporation or the Minister, which-

ever is concerned, would then be under an obligation to comply with those findings and to implement a decision.
There cannot be much doubt that if the tribunal were set up and produced findings the Minister and the Corporation, if under a statutory duty, would comply. The first situation which we think ought to be dealt with is under Clause 3(1,b) of the Bill. Under that Clause there is a duty on the Corporation to see that neither the Corporation nor the publicly-owned company shows any undue preference to or exercises any unfair discrimination against persons who use iron and steel products.
In particular, they are not to exercise such discrimination in relation to supplies or price. If there is a shortage of supplies, everyone should have a fair ration. They are not to give advantages to one user of steel against another by varying the price between the two. It is an agreed purpose of the Bill, inserted as I understand it by the Government, that there should not be any such preference or discrimination, either by the Corporation or the publicly-owned companies.
However, the Bill provides that even if such unfair discrimination or preference exists, there is to be no liability upon the Corporation, who are meant to have prevented it. This arises under subsection (3) of the Clause. Not only that, but there is no machinery for deciding whether such unfair discrimination or preference has taken place, there are no sanctions of any sort against it, there is no possibility of any independent investigation into the facts of such a complaint and no possibility of putting it right unless the Corporation decides to do so.
Complaints may be made against the Corporation so that the Corporation alone, when a complaint is made about its conduct, would have to decide whether it had permitted any of these practices. It must be wrong that in a matter of this importance a complaint against the Corporation should be dealt with by the Corporation alone. The future private sector


is very worried that there will be discrimination against it. It is also vital for the steel-using industry, the motor car industry and many others, that the Corporation and the publicly-owned companies should treat them equally fairly.
To make sure of this, we ought to see that reasonable suspicions and firm complaints are investigated, and are seen to be investigated, and that there is no suspicion that they are being covered up. For this reason we propose the tribunal, Which in a sense is an ombudsman for the industry. It could look at files and investigate the complaint and give an independent view, which the citizen who thinks that he has been unfairly treated could rely upon.
There is no doubt that the mere existence of such an independent tribunal would act as a deterrent and would have a beneficial effect in that it would ensure that such unfair discrimination or preference did not occur. The Minister objected to the principle of this proposal in Committee. First of all there was a suggestion of a different body. We proposed this independent tribunal but his objection to it was that it would undermine the commercial character of the Corporation and its operations. This surely is wrong. It is absurd to take that view if one reads Clause 3(1,b), which expressly provides that ordinary commercial considerations and the public interest are grounds on which the Corporation or the publicly-owned companies may vary terms or conditions of supply or may vary prices between different users.
If, therefore, the Corporation decides, for proper commercial reasons and for ordinary commercial considerations, to embark on variations or preferences in prices or supplies it can easily show to an independent tribunal that the cause of what appeared to be unfairness was its mere commerical discrimination, and it has nothing to fear from an investigation into the matter. What is aimed at in the new Clause is unfair discrimination or undue preference undertaken for reasons which are not commercial. Against such a practice there is no sanction and no safeguard and no possibility of discovery or investigation. That is what is feared, and that is the purpose for which we think this independent tribunal should exist. We

think that it is necessary and would be useful in preventing what the Bill is aimed at preventing.
I said that there were three purposes for which the tribunal might be needed. The second arises under Clause 13, subsection (2) of which gives the Minister the most remarkable delegated powers. He may, by publishing a notice as he thinks best and framed as he judges convenient or expedient, take power to himself to prevent anyone, without his consent, from setting up for the first time, reconstructing, and even from making the smallest addition to any plant, machinery or any premises used in any part of the iron or steel industry. In other words, he is given complete control down to the tiniest detail over any change in the plant and machinery or premises of the private sector.
Constitutionally, I am astonished that such enormous delegated powers should be given to the Minister on his say-so and by his putting his signature to a document. This provision gives the Minister complete power over the private sector to control it as he pleases. Such a power could, if exercised, result in the private citizen affected going to prison, because he is subject to an injunction. If he disobeys the injunction, the penalty is prison. This power is exercisable by the Minister by a notice incapable of correction at the instance of anybody which will create obligations even on those who have never seen the notice or had it served on them or drawn to their attention. This is the result of giving delegated powers in this form.
The Select Committee on Delegated Legislation, which reported in 1953 and whose Report has always been accepted as authoritative, dealt with various classes of delegated legislation orders. One of the classes which it mentioned is orders which are deemed to be of special importance—that is, politically or constitutionally important, or important because they may operate to the prejudice of particular persons or classes of person. The Clause 13 power being placed in the Minister's hands is plainly within that category, for two reasons: first, because it is politically important, and, secondly, because it is certainly a power which might be exercised to the prejudice of the private sector.
The Select Committee said that any powers within that category should be subject to affirmative Resolutions of both Houses of Parliament before they operate. Yet, under Clause 13, they are not to be even laid before Parliament for information or to be subject to the negative Resolution procedure or Prayer. This is certainly miles from what the Select Committee suggested for this class of power, namely, that it should be subject to affirmative Resolution by both Houses.
I am astonished at the moderation of our proposal. We do not even say that Parliament should have control over the exercise of this power by the Minister—a power which, as I have said, the Minister can give to himself as an absolute and unchallengeable right, however injurious it may be to an individual or group of people.
6.15 p.m.
Unhappily, we know from experience that all Ministers are not always right. We know that even Ministers who are nearly always right are frequently not always right. We know that even Ministers who are almost nearly always right frequently, by the bluntness of the instrument which they create and by their failure to appreciate the implications of words which they have employed in legislation, may have disastrous effects on individual citizens or groups of citizens. Equally, we know that often Ministers, like most people in power, are reluctant in the extreme, once they have made an order, to have it challenged or altered.
I should have thought, therefore, that it was necessary to provide for an independent body which can tell a Minister that he has made a mistake, however great or small, and even though it affects only one or two people it is important that the Minister should be told, when taking to himself this absolute power, that there is the chance that an independent body should consider what he has done and advise him that, while it may agree with him almost totally, there is some way in which it can be improved. The tribunal which we propose is certainly less cumbersome and certainly more convenient to the Minister than having to go through the affirmative Resolution procedure in both Houses. But it is a necessary and essential check on

the exercise of the absolute executive powers conveyed by Clause 13 on the Minister.
The third matter with which the tribunal should be able to deal is the power given in Clause 36(3). This is an important power, but it is less important than the power which the Minister can confer on himself under Clause 13. By Clause 36, the Minister has power to give notice to a producer requiring him to send to the Minister forecasts of his output, of the capacity of his plant, and of other details of his iron and steel production such as are set out in the notice.
The Minister can require forms to be filled in. He can require information to be given in detail. He can require it to be given at periodic intervals within a limit of time. Suppose that the unfortunate citizen feels that this is hard on him and is totally unnecessary. It is a criminal offence if he does not obey the Minister's letter. The Minister may say, "You tell me this, that and the other". If the citizen does not do it, he commits a criminal offence. This is an uncontrolled power given to a Minister by delegated legislation to create a criminal offence and to put people in peril of the dock.
If individuals or any class of people think that they are being unfairly treated and that the whole process is a lot of mumbo-jumbo, an independent body—I should have preferred Parliament to do it—such as a tribunal set up by the Minister should be able to look into the matter and adjudicate between the citizen who complains and the Minister.
These are important matters. In our constitution in this country we have always tried to provide checks and balances between the Executive and the citizen who is affected by the Executive. I submit that in these circumstances it is right that on these occasions there should be a small check and balance, in the form that we have put forward, upon the absolute executive powers which the Minister is taking to himself by the Bill.

Mr. Charles Fletcher-Cooke: Whenever I read in a Bill the magic words, "It shall be the duty of the Corporation or of the Minister" or "It shall be incumbent upon the Corporation


and the Minister", I always ask myself, "Is this just propaganda? Is this propaganda in the form of legislation, or is it law making in the sense that if the duty is broken there is some sanction provided?" If no sanction is provided, and if any possibility of sanctions is positively removed, as in Clause 3, it means that when we say that we are legislating, we are not legislating at all, but are just putting in the form of pious propaganda what is law.
It therefore seems to me that this raises an important principle, not merely for this Bill but for all the Bills which have gone before and all those, I fear, which w ill come after by which duties are imposed upon public persons and public bodies, but in which there is no remedy if the duty is broken. That is why it seems to me that we are here seeking to create an important and salutary precedent which might be imported into many other Bills concerning public authorities, not merely saying that there is to be a sanction but also seeking to redress the possibility of tyranny and oppression, and seeking to redress it in such a way that the citizen or the company has redress as of right and not merely if he excites some hon. Member to raise a matter in the House, with all the chances and lack of chances that that machinery so often affords.
For Clause 3, what is suggested here seems to me very similar to what the Monopolies Commission can do in respect of private corporations. The Monopolies Commission is not empowered to examine the behaviour of nationalised industries. I have always thought that that part of the Act which deals with the abuse of monopoly position should be capable of being used for the purpose of seeing whether nationalised industries abuse their monopoly position. It is only too true to say that there is not much point in using the other part of the Act, which is for the purpose of inquiring whether a monopoly exists. Obviously it does exist, and will exist under the Bill, even though in this case it is not a complete monopoly, because the new Corporation will certainly be over one-third of the market.
But the Act setting up the Monopolies Commission goes on to say that the question is not merely whether there is a monopoly. Obviously there is a monopoly here, within the definition of a

monopoly. The question is also whether that monopoly is abusing its power. Clause 3(1,b) is almost a classic example of the danger of a monopoly, in the technical sense of the word, abusing its powers by discriminating in respect of its products in favour of people it likes or against people who, for some reason or another, it dislikes. The Monopolies Commission can examine just that point under the Act.
I should have preferred that the new Steel Corporation and many of the old nationalised industries were susceptible of investigation by the Monopolies Commission in respect of the abuse of a monopolies position. Certainly some of the electricity boards and some of the behaviour of the Post Office might well be so examined.
But I see that you are a little restless, Mr. Speaker, and I hasten to return to the new Clause. If the Monopolies Commission is not to be able to do this, then some other tribunal should do it. It is much the same task. Perhaps this tribunal would be a sort of Monopolies Commission for the nationalised industries as a whole.
I do not think that I have ever seen anything quite as strong as subsection (3)— though I may be wrong—in positively withdrawing any sanction that might exist. I know that there is always a dispute between lawyers when a statutory duty is imposed in so many ways on a public authority. There is always a dispute whether that gives the private citizen who is damnified by what he considers a breach of that duty, the right to go to the courts. This is always a matter of dispute.
Here the dispute has been resolved by the Government in the most brutal fashion by their saying that there shall be no remedy at all. Perhaps, these being economic matters and being very sensitive matters, the Government do not feel that the judges are the right people to look at them, although I do not agree with that suggestion. But surely they cannot have that objection to the tribunal proposed here, which would have no power other than that of drawing public attention to what is going on.
That is a sanction, but it is a fairly frail sanction. Surely the Minister is not so frightened of the activities of his


Corporation that he will shy away from that. It will be a very good test of his bona fides in the matter, particularly under Clause 3, if he objects to treating his Corporation in the same way as that in which the Monopolies Commission treats I.C.I. or Unilever or the tobacco companies, for example. Why should not his Corporation have that treatment? The Monopolies Commission has not much more power than this tribunal would have, but there is the very salutary sanction of publicity, and we feel that that is the very minimum that we should demand.
For that, among other reasons, I strongly support the new Clause.

Mr. John H. Osborn: I listened with interest to the speeches on the new Clause by my right hon. and learned Friend the Member for Warwick and Leamington (Sir J. Hobson) and my hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke).
We have discussed in Committee the question of fair competition and of ensuring fair competition and all the powers that should be given to the Minister. I first raised the issue of discrimination when we were discussing Clause 3. In Clause 3(1,b) there is a reference to the fact that
neither the Corporation nor a publicly-owned company shall show undue preference to or exercise unfair discrimination against…
Subsection (3) begins:
Nothing in subsection (1) above shall be construed as imposing upon the Corporation any form of duty or liability enforceable by proceedings before any court.
6.30 p.m.
I raised this whole question early on in the Standing Committee, when we put up an Amendment, No. 109, to insert:
and any question whether or not the Corporation have complied with their duties under this paragraph shall be determined by the Arbitration Tribunal".
At that time we were referring to the tribunal which had been set up under a previous Act and would have operated under Clause 28. The Minister originally, I think, was a little bit dubious about the purpose of this, but I hope now, after the remarks in the Committee, he will give this case his very careful consideration. The Minister later showed

concern that I was so worried about the private sector because he felt I was setting about ensuring that the private sector should be able to operate unfairly against the public sector. It was in the early hours of the morning that he said that, and I can understand that he could have felt a little short-tempered, but I can assure him that the aim of hon. Members on this side was and is to ensure that there should be fair competition, in favour neither of the private sector nor of the public sector.
We have discussed the issues—the prices at which goods are to be sold from one customer to another, the prices of raw materials made available to one manufacturer compared with another, bearing in mind that many of the raw materials, including iron ore, would be under the Corporation; then there is the question of the availability of finance, and will the public sector be able to obtain loans at favourable interests rates which will be denied to the private sector? Then, of course, there is the danger of discrimination between one public body outside the steel industry against the private sector of the steel industry.
These various points were raised in the Committee, but when there is disagreement whether there has been fair or unfair competition it is vital that that disagreement should be resolved rapidly, and my own view is that resolving the matter by going to the courts would not be speedy and therefore would frustrate the private sector—as it would be in this instance.
We made reference from time to time to the report, "The manufacturing powers of the nationalised industries", published by the C.B.I. some time ago. In section 6, on page 16, it stresses that
A system of enforcement would be necessary to see that those criteria were in fact followed. This would be best put in the hands of an independent body with a small permanent staff or panel of professional advisers. Its tasks would be (i) To establish the standard return on capital for an industry and to review it from time to time, (ii) To act as an appeal tribunal for complaints against nationalised undertakings of unfair trading, and in particular of preferential treatment where arms length trading is prescribed".
We have this document behind us, and it prompted us to propose new Clause No. 5 with a view to setting up a tribunal but, unfortunately, it was not called. However, when Clause 28 was being discussed


in Committee I raised this matter with the Minister, and he said:
Notwithstanding, the point he raises"—
he meant me—
is a clear one, and, of course, I would be willing to meet and discuss with the private sector this or any other point it may raise."—[OFFICIAL REPORT, Standing Committee D. 13th December, 1966; c. 2288.]
In December, this was a matter of concern to those operating the private sector. The outcome of this was that the private sector made a protest to the Minister. He referred to this in Committee. It wrote subsequently, and I do not know the contents of the letter or the contents of any reply the Minister sent. Subsequently, the Minister reminded us in Committee of the absolute powers of discretion he had over the public sector as well as the private sector, and this prompted many outside this House to insist that there should be some outside body to ensure that there should be fair competition and fair treatment, and those are the sentiments behind this new Clause, which relates not only to Clause 3(1,b) but also to Clause 13 relating to capital development and also to Clause 36(2) relating to the furnishing of information.
This argument about the need for this has been put over very lucidly, but I think it relevant to outline a typical problem which has faced the private sector of the steel industry within the last 48 hours. I refer to the Millom Hematite Ore and Iron Company, in Millom. It could well be that a decision of the Iron and Steel Board under the 1953 Act is a classic example of the sort of decision which would frustrate and kill private enterprise.
I delay in expressing any opinion on the rights and wrongs of this decision because it could be wrong to do so in detail as I have not enough information, but, as I said in Standing Committee, I have been privileged to sit on the Council of the British Iron and Steel Research Association for a year or 18 months and have been able to witness the enthusiasm of those who have developed the concept of spray melting. I had the privilege to meet Dr. Pearson, amongst other people, and have seen how this particular process had been developed in Hoyle Street, Sheffield. I believe I referred on Second

Reading to the enthusiasm there was about it, and I certainly did so in Committee.
There are various aspects with which big manufacturers have been preoccupied, in the early stage of insulation, the electric arc, the L.D. furnace and the Kaldo furnace. They have been preoccupied by the fact that they are likely to have surplus capacity. Rightly or wrongly they were not inclined at that time to give this new technique of continuous melting a trial.
This small company in Millom decided to take it on and give it a try and on 12th October last year they had an open day. The Press were impressed. There has been a series of articles which appeared in the Daily Telegraph, The Times, the Financial Times, even the Sheffield Telegraph, a paper well known in the Standing Committee, in The Guardian, a more detailed article in the Observer, and the New Scientist. They said that there were aspects of this which showed great promise. I have seen the enthusiasm amongst those associated with this in B.I.S.R.A., without reservation as the process developed.
In The Times, on 18th January, there was this remarkable statement, that this steelmaking plant, a British invention,
is the most exciting new development the world iron and steel industry has seen for many years, is being held back from commercial development by the Iron and Steel Board…World-wide interest has been aroused…
It seems to be absolutely incredible that a decision of this type should be made. The Board issued last night the reasons for this, and they are reasons which hon. Members on this side will have to study very carefully, and that is why I shall not be unduly critical of the reasons.
On the other hand, the Sheffield Telegraph was able to comment in a leader—I was surprised it said it—
The Iron and Steel Board's kiss of life.
I am not sure that it is the kiss of life for this small company which took a chance to develop this process because it thought it fitted in with its own requirements. The article said:
So what seemed the kiss of death becomes the kiss of life, and Britain has need of it.


Finally, it said:
All the world loves a fighter, and there will be much sympathy with Millom in its fight to secure its spray refining.
A decision has been made by the Iron and Steel Board, and last night I received a letter from the managing director of Millom, Mr. Davies. Subsequently, I telephoned him and he told me of his disappointment. I have no doubt that he is an energetic person. His company has taken the trouble to develop the process and take it through its first stage. He is now denied the right of developing it further, for whatever reason.
If a little firm takes a chance like that, and is crushed by the decision of an autocratic body, whether it is the Iron and Steel Board which was set up by the 1953 Act, or some other body which would result from decisions by the Minister under Clause 13 of the Bill, it is vital that, somehow or other, that firm should have some redress. I raised the question because we have to ask ourselves if decisions of the Iron and Steel Board or decisions of the Minister under the Bill are right ones, and how we are to know whether they are right ones.
The other interesting point about that case is that it proves that the Iron and Steel Board really has the powers which the Socialist Government said that it had not and which justified the nationalisation of steel. The right hon. Member for Vauxhall (Mr. Strauss) put forward the idea that a stronger Iron and Steel Board might be the best solution for nationalising the steel industry. I would suggest that the Millom case shows that, if necessary, the Iron and Steel Board has those teeth and has used them.
As I see it, under Section 6(4) of the 1953 Act, if the Board refuses its consent to any such proposal it must state in writing its reasons to the person making the proposals. The procedure is outlined. In the case to which I have referred, under the Act, Millom may now appeal to the Minister if it does not like the decision of the Iron and Steel Board.
In the present Bill, Clause 13(5) says:
…the Minister shall, before giving or refusing his consent, consider the report of the person so appointed".
But, under the new Act, we must still have an independent body acting as an

arbitration tribunal to ensure that, in such a case, there has been fairness.
This is the first example of many instances where the Minister or a body set up by him will frustrate energetic development and success. Although Lancashire Steel is setting up a larger unit and has had Iron and Steel Board approval for it, and although other steel firms are said to be interested in it, at the time of taking the decision it was one small firm which elected to take up the process which had been developed by B.I.S.R.A. It has taken a risk, and it will now pay dearly for taking that risk. What redress has the private sector in this or in other instances when decisions, whether justified or not in terms of administrative or planning convenience, are taken?
I ask the Minister to outline what sort of procedure he visualises under the Bill where a private company takes a chance and receives world wide acclaim. I think that scientists, technologists and engineers will admit that there is still much development to do, and it could be right that other firms should do it—

Mr. Shaw: Am I correct in assuming that not only would the company lose if it is not allowed to go on with its development but, quite apart from its own development, the whole scheme would be held back, because this is the only practical application which so far has been made?

Mr. Osborn: It would. However, if a small company has developed know-how over a period of time, it means that it has a lead which it would now wish to exploit and maintain.
I have told the House about an experience which I had over ten years ago when I thought that I had a process which had a technological lead. To maintain that lead, the essence was speed. With an enthusiastic managing director and company, the need is to give them every possible chance so that there will not be time for other firms, despite their larger technological and financial resources, to catch up and overtake. Given time, someone else may take on the process, and the firm's technological lead slips back.
The background to the example which I have referred to is a mixed one, because it was the enthusiasm of people in the


B.I.S.R.A. which developed it. However, it shows the relationship which exists between a small firm and its research association.
The real point is that a decision has been taken. The right hon. Member for Workington (Mr. Peart) will be concerned, because, if the company has been hit on the head, it will have a setback which will mean closures and shutdowns. We now come back to sociological and regional problems, because no one knows what other interests in the area will be affected. Has the Iron and Steel Board considered that point? It is an example of the serious problems which will be before the country when the Bill becomes law.

6.45 p.m.

Sir John Eden: I have listened with a great deal of interest to what my hon. Friend the Member for Sheffield, Hallam (Mr. J. H. Osborn) had to say. I was glad that he cited this case as an example of the sort of disputes and differences which could occur in the future between the private sector and the public authority, whatever may be devised to take the place of the Iron and Steel Board in the future.

Mr. Marsh: The hon. Gentleman says that it is an example of what could happen under the Government's Bill. In fact, it is a good example of what has happened under the Conservative Government's Iron and Steel Act.

Sir J. Eden: We are concerned to see the sort of procedure that is likely to be established in the future for settling a difference of this kind as a result of the passing of this Bill into law. That is why we press this Clause on the Government. We want to see established some judicial form of procedure by which such a dispute can be resolved without the aggrieved party having to turn to the Corporation or to the Minister for final judgment. The Corporation, of course, would be a very interested party.
I thought that the example given by my hon. Friend was an extremely appropriate one. Here is a small private enterprise company which has embarked upon a new venture at considerable risk to itself, though admittedly in conjunction with and with the active support of the

British Iron and Steel Research Association. It has been extremely successful. The result of the company's labours and ingenuity has led to the installation of a spray refining system at its works. It is the only installed working process of which I have knowledge.
What the company wanted was to get assistance to develop it still further, and it needed £1 million for the purpose. Consent for that was withheld by the Iron and Steel Board. There may have been reasons for it.

Mr. J. H. Osborn: I have not got—

Mr. Speaker: Order. I cannot allow hon. Gentlemen to pursue this case in detail. We must link it now to the need for a tribunal to settle this kind of case.

Sir J. Eden: Mr. Speaker, I wonder whether, before I continue, I might hear my hon. Friend's intervention?

Mr. Speaker: indicated assent.

Mr. Osborn: I have not got the Press release before me, but I believe that the expression was "deferred", rather than "held back."

Sir J. Eden: I think that it is also the company's view that "deferment" is a polite way of saying "no". That was the implication, but I hope that the deferment will ultimately lead to the matter going ahead. It was not my intention to go into the detail of the process. It was clearly outlined by my hon. Friend, and he gave full emphasis to its significance. The point I wish to make is that this decision was taken not by the company concerned using its commercial judgment, but by a quasi-official body which had been established to act as a sort of go-between between the private enterprise steel industry and the Government, and we are worried about the establishment of just such a procedure in the future. That was essentially a bureaucratic decision, and not a commercial one, and I want to ensure that where a company comes up against something like that it will be able to take its case to a proper body to get the dispute resolved.
During the Committee stage the Minister went out of his way—after a considerable amount of debate—to reassure the Committee that he was interested in the industry as a whole, and not just in


the public sector; that he was as concerned about the healthy growth of those companies which would remain in the private sector as he was to ensure the satisfactory development of the Corporation and its publicly-owned companies. I have no doubt that that is correct, and he went some way to try to meet us on the point that there should be proper appeal procedure in the event of a dispute arising.
We are grateful to the Minister for the steps which he has taken along those lines, but I have here the copy of HANSARD which records the speech made by the then Parliamentary Secretary to the Ministry of Power. The hon. Gentleman referred frequently to his belief that the introduction of some kind of formal arbitration machinery such as is proposed in this Clause would severely restrict the commercial freedom of the Corporation
in a way contrary to the principles on which we"—
that is, the Government—
wish to see it operating.
The hon. Gentleman went on to say:
If we were to sew up any kind of price structure, adding on top of the publication of price lists, on top of whatever machinery may be created by the Minister with the industry, further machinery for arbitration of disputes between producers, we should get a quite unworkable machine."—[OFFICIAL REPORT, Standing Committee D, 17th November, 1966; c. 748–9.]
I could quote other references to show that that apparently was the view of the Government. I take it from that that they were certain that disputes would arise.
The Bill contains Clauses about nondiscrimination, but I am not convinced that the arguments put forward in Committee are strong enough to make me accept that this non-discrimination should not be enforceable. I should like to see established some independent, formal procedure to enforce non-discrimination on prices and on other areas of dispute which are likely to arise between the private sector, the Corporation, and any one or all of the publicly-owned companies.
I do not believe that the Consumer Council is the proper body for this. The Minister might call the Consumers' Council in aid, but this Council has no power to redress grievances. It will only be able to report back to the Corporation or

to the Minister. What we are calling for in this Clause is something infinitely stronger. We say that if the tribunal finds in favour of the appellant, and finds that he has been discriminated against, it
shall so determine and publish its findings and the reasons for its findings…and the Minister…shall give effect to the determination.
That is much stronger, much more positive, and much more in keeping with our sense of fair play and justice. That is what we want enshrined in the Bill, because once the Bill becomes law there will be established a nationalised manufacturing industry which will be in a substantially dominant position over a comparatively small, though none the less important and significant, private sector.
We want to ensure that where, in the private sector, there are developments of the kind to which my hon. Friend has referred, and which I, to, have mentioned, there is no discrimination against them. We want to ensure that if there is a likelihood of discrimination against the private sector on pricing, there will be a proper, effective, and independent arbitration procedure to decide on the appellant's case. I have strong reasons for supporting the Clause, and in view of the interest which the Minister has displayed in securing the future health of the private sector, I hope that he will accept it.

Sir G. Nabarro: To put the matter in its correct perspective, I think that we ought to say now that 93 per cent. of the industry is to be nationalised, and 7 per cent. of it is to remain in private hands, if we use as a measurement the output or manufacture of steel. This will put the public sector, not in a position of a very substantial majority, as my hon. Friend said, but in a position of overwhelming supremacy. It will be able to crush the private sector by many direct and specific, or overt, practices.
I have intervened in the debate at this late stage for one reason, and I propose to do so very shortly, for I am no lawyer. I fear that the Minister will say that a tribunal of the kind suggested in the Clause is not really a practicable proposition, that it has no proper precedents. I want to draw his attention to the best possible analogy, to an Act of Parliament put through this House by his party, the Race Relations Act, 1965. This Statute seeks


to protect 750,000 coloured people in this country from discrimination against them by an overwhelming majority of 53 million white people. It does that by the establishment of a Race Relations Board. Reading back through that Act, I find the words "discrimination", "discriminating", and "discriminatory" used over and over again.
That is exactly the position, in a material context, in which the private sector of the steel industry will find itself if the Bill reaches the Statute Book. I am sorry that the Parliamentary Secretary to le Ministry of Power is so mirthful about what I am saying. Why is he giggling? After all, he was promoted only a few days ago. His name, Mr. Reginald Freeson, is the second name on the Race Relations Act, 1965 (Amendment), Bill which was brought to this House during this Session. I am in good order, Mr. Speaker, because the Bill has been withdrawn, and I may therefore allude to it. It is no longer before the House. The hon. Gentleman's was the second name to that Bill, and if one reads it as it was printed, one finds the word "discrimination" used over and over again.
I claim that that is a precise analogy to the private sector of the steel industry, although the one is a moral and ethical issue with which I am much in sympathy—the racial relations issue—and the other, about which we are talking tonight, is an utterly material, industrial and commercial issue. I hope that we shall not have any nonsense from the Minister of Power to the effect that there are no respectable precedents for the kind of judicial tribunal suggested by my right hon. and learned Friend.

7.0 p.m.

Mr. Marsh: This is an important subject, and it is quite right that the House should be mindful of a Bill of this type which can affect the interests of people, whether it be many people or a few. In this case most of the appellants would hardly be widows and orphans, but that does not make much difference in terms of numbers involved. It is important that there should be proper accountability for decisions which affect people's livelihoods, and that these should be made public. What we are arguing about is the way in which this should be achieved.
Much concern has been expressed by the private sector. As I said yesterday, the fears expressed are unjustified. People in the private sector have made representations to me on this matter, however, and the Government have done what they could, and they will continue to do what they can, to see how far they can meet those fears. One fear is that the Corporation will be encouraged to operate to the detriment of the private sector. There is a constant fear that it is necessary to protect the private sector against the encroachments of this very large organisation.
Although I have said it many times in Committee it has not been accepted by many in the private sector that the Minister of Power is also the sponsoring Minister for the steel industry and that there is no sense in maintaining a private sector of that industry and then allowing it either to be destroyed or wither away. If the Government decided that they did not want a private sector in the steel industry, the thing to do would be to nationalise the lot. The Government have taken a conscious decision not to do so. That means that they have taken a considered decision that the private sector is as important as the public sector to the economy of the nation.
I make this point in general terms because, underlying many of the pressures that have been created, there is a fear that the Government, consciously or unconsciously, would allow the private sector to be destroyed.

Mr. Fletcher-Cooke: I do not understand the Minister's argument about the impartiality of a sponsoring Minister. The Minister of Aviation is the sponsoring Minister both of the nationalised corporations and the independent operators, but does the right hon. Gentleman really say that the Minister of Aviation has never favoured the nationalised corporations?

Mr. Marsh: I do not want to comment on a Department other than my own. It is as much as I can do to keep up with mine. I merely say that a very real fear exists in this matter, and that I genuinely believe that it is completely misplaced. The private sector of the steel industry is essential to the effectiveness of the industry as a whole. It has a special part to play. It sometimes makes special
products and special steels, and its help is essential to the whole industry.
It follows that we must decide how far the Minister and Parliament can be relied upon to keep the ring so as to ensure that the views of people aggrieved by decisions are taken into account and that questions are settled impartially, where they can be. I shall come to the question of partiality in a moment.
The hon. Member for Sheffield, Hallam (Mr. J. H. Osborn), whose ingenuity in raising questions of this type I learned to admire in Committee, raised a specific and important point which was indicative of the argument that he was putting forward. I have said that this arose out of an existing Act—something already with us. An hon. Member had asked what could be done in the case of an aggrieved person—although in this case the person would be a company—against a decision of this type? What is being done is exactly what the hon. Member has been doing—quite rightly—namely, to raise this issue in Parliament, because the Minister is responsible to Parliament. The Iron and Steel Board is responsible for its activities to the Minister. The Board has not taken a final decision on this matter, and I cannot pursue it. I cannot judge the issue, precisely because this decision may well be referred to me.

Sir J. Hobson: The difficulty is that under the 1953 Act any decision of the Board which affects a citizen is subject to appeal to the Minister, who has then, acting in a quasi-judicial capacity, to listen to representations from both sides, just as the Minister of Housing and Local Government takes quasi-judicial decisions. One then has a form of appeal, and it is not merely a question of administration.

Mr. Marsh: Perhaps I may leave the particular and return to the generality. When these matters are raised in Parliament Ministers have to stand up and justify their actions. That is one of my arguments about the responsibility of Parliament.
My objection to the Amendment, and to the creation of this intervening body, is precisely that in the question of discriminatory practices, for example, we have all agreed—some more enthusiastic-

ally than others—that one important thing about this exercise is that we are now nationalising a different type of industry. There must be a recognition of the fact that there has to be a maximum amount of commercial operation consistent with public responsibility. We have discussed how this can be achieved, and there have been differences of opinion on the point.
We cannot run a nationalised steel industry as a social service. It is a manufacturing industry, and must be run as such. When I say that we are going to run it in this way it follows that the Corporation and the companies must have a degree of freedom over pricing. Yesterday, it was suggested by hon. Members opposite that there must be complete freedom between different groups on the subject of pricing. We accept all this. That being so, these groups must have the right to charge different prices, or to discriminate against certain of their consumers, if there is a good commercial reason for so doing.
People who feel that they are being discriminated against unfairly must then have some way in which to ensure that their grievances are aired. They can do this either by representation to the Minister or by way of the Consumer's Council, or both. The hon. Member for Worcestershire, South (Sir G. Nabarro) said that he did not see the Consumer Council as a body which could be—

Sir G. Nabarro: The Minister has got it wrong. My hon. Friend the Member for Bournemouth, West (Sir J. Eden) made the point about the Consumer's Council. The analogy that I made was to the Race Relations Board. That is a much more accurate analogy, because that Board has judicial force behind it the Consumer's Council has not.

Mr. Marsh: With respect, I would have thought that the Consumer's Council, which has been accepted as a method of redressing the grievances of consumers in the nationalised industries—

Sir G. Nabarro: Not by me. No, Sir.

Mr. Marsh: All I can say is that this has been accepted and not changed. Hon. Gentlemen have been for 13 years in charge of this body. If they have been discontented, they have at any rate


accepted that this has been the natural way of representation. The analogy is closer with the other nationalised industries than with the Race Relations Board and discrimination, which is a different subject. The Consumer's Council is charged specifically with a duty to consider any matter affecting the interests of consumers, including prices. When the Minister receives the report of the Council he is then empowered to give directions on any matter which arises.
At present, therefore, the decisions in relation to aggrieved bodies are made public. Changes have been made in the Bill to ensure that the Minister's reasons for rejection or acceptance are published. There is the right of appeal to the Consumer Council and the obligation upon it to inform the Minister, who then has the ability to direct the Corporation in specific cases.
However, what we are arguing about then is how far this satisfies the position—

Sir G. Nabarro: Not at all.

Mr. Marsh: The hon. Gentleman is entitled to his point of view, but this is a serious subject and if one does not agree that people have the right degree of access to appeal it is wrong to defend the issue.
I believe that such a tribunal would cut across the direct personal responsibility of the Minister to Parliament. If the hon. Member for Hallam at some stage were dissatisfied with the decision reached in a case, and wanted to pursue it, he would rightly demand to know what the Minister had done and challenge this as direct Ministerial responsibility. Development and the withholding of consent for development are important decisions to the industry and to the economy, but the important thing is that Ministers or Governments must accept responsibility for these decisions and not say that "some other tribunal has decided." As to the analogy with housing and local government, that Minister is hearing an inspector and taking a decision—

Sir J. Hobson: Can the right hon. Gentleman explain, as he is making the point that the tribunal is unnecessary because the Consumer's Council exists, what the Council would have to do with powers under Clauses l3 and 36?

Mr. Marsh: I was talking of Clause 3. I will come on to the other secondary points in terms of forecasts and statistics and the question of withholding consent. These are major decisions which should be taken; the Minister must have control and the Government has to stand for them.
There is a special situation, however, in relation to Clause 3, as it affects the private sector companies which may be not only in competition with the nationalised sector, but also dependent on it for supplies of raw materials and semifinished products. I hope to announce concessions. There is a later new Clause, in the discussion on which I hope to make a statement and subsequently to table an Amendment which will relieve some of the difficulties and fears of the private sector.
Basically, if the argument is that the Corporation would want deliberately to conduct its operations to the detriment of the private sector, it is an untenable one. Second, the procedure for protection in the Bill at the moment is adequate. Third, the type of appeals tribunal as suggested in the Amendment has no precedent. I do not condemn it for this, but given the machinery for consumer representation—these consumers are pretty powerful—and the fact that the Minister can give directions and is answerable to Parliament in such cases as the example referred to by the hon Member for Hallam, the new Clause is unnecessary and will, if anything, detract from the responsibilities of the Minister.

7.15 p.m.

Mr. Barber: I am disappointed—as I am sure the industry will be—at the Minister's reaction to the cogent arguments advanced from this side in support of the new Clause. After all, its sole object is to ensure fair competition between the public and private sectors. The Clause has the avowed object of providing equity for the 200 smaller iron and steel companies which will continue under a capitalist system. We know that such a proposal is anathema to many hon. Gentlemen opposite, but it is not good enough for the right hon. Gentleman to say, "I am the sponsoring Minister. It is my duty to look after the private as well as the public sector and see that there is fair play between them."
I do not doubt the right hon. Gentleman's sincerity. When he says that he wants a good, healthy private sector, I know that he means it and will do his best to ensure it, but he is not the only Minister who will be Minister of Power and operating the Bill. There may well be others. Suppose that the right hon. Gentleman, unhappily, were not well for a week or two and his new Parliamentary Secretary was in charge. Is it seriously believed that his Parliamentary Secretary would be likely to exercise any judgment between the public and private sectors in the same way as the right hon. Gentleman?

Mr. Marsh: rose—

Mr. Barber: Let me finish. I should be grateful if the right hon. Gentleman will intervene in a moment on this point. I should like, first, to complete my argument.
As I said the other day, the Parliamentary Secretary—presumably his views have not changed: if they have he can say so—said to his electors in his election address—[Laughter.] The hon. Gentleman laughs. Perhaps he did not mean it. However, what he said was:
We reject the selfish, greedy doctrines of capitalism.
This is the 10 per cent. of the iron and steel industry which will be under the sponsorship of the right hon. Gentleman.

Mr. Marsh: I have no doubt that my hon. Friend would take decisions, if I were incapacitated, with even more efficiency than I. My argument was not that Ministers have an attraction to the private sector, that they feel fond of it and some are nicer to it than others, but that the whole reason for maintaining the private sector is that it is an integral part of the steel economy and essential to it. No Minister would want, while there is a private sector of this size, to see it lose any efficiency—not because he has an affection for it, but because it is necessary.

Mr. Barber: Perhaps the right hon. Gentleman could clear this up simply. He says that he will be fair between the public and the private sectors. Would he quite clearly say whether or not he agrees with his hon. Friend's reference to the "selfish, greedy doctrines of

capitalism"? Let him "come clean" and say so. This is very important. Does he agree or not?—We take it, then, that the right hon. Gentleman is embarrassed by his hon. Friend and we leave it at that. Otherwise, of course, the Minister would have answered my question. This is highly relevant.
When the Minister says that it is his policy to promote what he calls a healthy, viable private sector, I accept that assurance, but I most certainly do not accept it from many right hon. Gentlemen on the Front Bench opposite. We know, from what they have said, that they would do everything they possibly could to extend public ownership. However, I leave it at that. Hon. Members can draw their own conclusions.
The right hon. Gentleman may laugh, but the proposal we have put forward is of immense importance to the private sector of industry. The right hon. Gentleman has already gone some way in the new Clauses he has proposed to meet the fears of the private sector, and for that we are grateful; but among these 200 companies in the private sector, there is still a genuine fear that the all-powerful Steel Corporation, bolstered by the unlimited resources of the Exchequer, will squeeze many of them out of business. That is what they believe, and there is the genuine fear that there will be unfair discrimination by the Steel Corporation not only on the question of prices, but also in other ways. If this were to happen, then the very size of the Corporation, and the resources behind it, would always ensure that it won.
The possibility of unfair discrimination cannot be considered in isolation. It must be considered together with the unlimited powers in Clause 2 of the Bill, which enable the Corporation to take over and to control any company in the country —and when I say "any company", I mean literally any company in the country.
The Minister has always maintained that the great safeguard here arises from the fact that such a take-over could only be by agreement. Of course, if the Steel Corporation were artificially to cut its prices of those products manufactured by a competing company in the private sector, it would not have the slightest difficulty in artificially depressing the


value of the shares of that company, so forcing that company to its knees and acquiring it at a knock-down price.
That is the sort of thing of which those in the private sector are genuinely afraid. The right hon. Gentleman can laugh when I quote from the views of some of his hon. Friends, and of his Parliamentary Secretary in particular, but the people outside who are affected by these views do not laugh. They may be wrong, but they take them as being the genuine opinions of the Minister concerned, in this case the Parliamentary Secretary. He thought they were of sufficient importance to include then in his election address. I know that hon. and right hon. Gentlemen opposite laugh about election addresses, about the pledges they give. They say, "It is all a little bit of Parliamentary fun; we are in for a few more years with a majority of 100, so the electors do not matter". I say in all sincerity that unless the hon. Gentleman withdraws in due course what he said—not necessarily tonight —it will cause a good deal of embarrassment to the right hon. Gentleman.

The right hon. Gentleman has already recognised the necessity for legislating against undue preference and unfair discrimination. Why not take this further step of providing for the oversight of these matters by a wholly independent tribunal which would command the respect of both the nationalised sector and the private sector? There are bound to be occasions when a private enterprise company is not content with the Minister's action concerning, for example, the limitation of the provision of new capacity. I am grateful to my hon. Friend the Member for Sheffield, Hallam (Mr. J. H. Osborn) for raising this matter, which has arisen under the 1953 Act and which is the sort of thing that can arise.

I very much regret that the Minister has not accepted at least the principle of the Clause, and, in the light of his reply, I must ask my hon. and right hon. Friends to take the matter to a Division.

Question put, That the Clause be read a Second time:—

The House divided: Ayes 232, Noes 302.

Division No. 237.]
AYES
[7.24 p.m.


Alison, Michael (Barkston Ash)
Crosthwaite-Eyre, Sir Oliver
Grimond, Rt. Hn. J.


Allason, James (Hemel Hempstead)
Crouch, David
Gurden, Harold


Astor, John
Crowder, F. P.
Hall, John (Wycombe)


Atkins, Humphrey (M't'n &amp; M'd'n)
Cunningham, Sir Knox
Hall-Davis, A. G. F.


Awdry, Daniel
Currie, G. B. H.
Hamilton, Marquess of (Fermanagh)


Baker, W. H. K.
Dalkeith, Earl of
Hamilton, Michael (Salisbury)


Balnief, Lord
Dance, James
Harris, Reader (Heston)


Barber, Rt. Hn. Anthony
Davidson, James(Aberdeenshire, W.)
Harrison, Brian (Maldon)


Batsford, Brian
Dean, Paul (Somerset, N.)
Harrison, Col. Sir Harwood (Eye)


Beamish, Col. Sir Tufton
Deedes, Rt. Hn. W. F. (Ashford)
Harvey, Sir Arthur Vera


Belt, Ronald
Digby, Simon Wingfield
Harvie Anderson, Miss


Berry, Hn. Anthony
Dodds-Parker, Douglas
Hastings, Stephen


Bitten, John
Doughty, Charles
Hawkins, Paul


Blggs-Davison, John
Douglas-Home, Rt. Hn. Sir Alec
Hay, John


Black, Sir Cyril
Drayson, G. B.
Heath, Rt. Hn. Edward


Blaker, Peter
du Cam, Rt. Hn. Edward
Heseltine, Michael


Body, Richard
Eden, Sir John
Higgins, Terence L.


Bossom, Sir Clive
Elliot, Capt. Walter (Carshatton)
Hill, J. E. B.


Boyd-Carpenter, Rt. Hn. John
Elliott, R.W.(N'c'tle-upon-Tyne,N.)
Hirst, Geoffrey


Boyle, Rt. Hn. Sir Edward
Eyre, Reginald
Hobson, Rt. Hn. Sir John


Braine, Bernard
Farr, John
Hogg, Rt. Hn. Quintin


Brinton, Sir Tatton
Fisher, Nigel
Holland, Philip


Brown, Sir Edward (Bath)
Fletcher-Cooks, Charles
Hooson, Emlyn


Bruce-Gardyne, J.
Forrest, George
Hordern, Peter


Bryan, Paul
Fortescue, Tim
Hornby, Richard


Buchanan-Smith, Alick(Angus, N &amp; M)
Foster, Sir John
Howell, David (Guildford)


Buck, Antony (Colchester)
Fraser, Rt. Hn. Hugh(St'ffrord &amp; Stone)
Hunt, John


Bullus, Sir Eric
Galbraith, Hn. T. G.
Hutchison, Michael Clark


Burden, F. A.
Gibson-Watt, David
Iremonger, T. L.


Campbell, Gordon
Giles, Rear-Adm. Morgan
Irvine, Bryant Godman (Rye)


Carlisle, Mark
Gilmour, Ian (Norfolk, C.)
Jenkin, Patrick (Woodford)


Carr, Rt. Hn. Robert
Gilmour, Sir John (Fife, E.)
Jennings, J. C. (Burton)


Cary, Sir Robert
Glover, Sir Douglas
Johnson Smith, G. (E. Grinstead)


Channon, H. P. G.
Glyn, Sir Richard
Jones, Arthur (Northants, S.)


Chichester-Clark, R.
Godber, Rt. Hn. J. B.
Jopling, Michael


Clark, Henry
Goodhart, Philip
Joseph, Rt. Hn. Sir Keith


Clegg, Walter
Goodhew, Victor
Kerby, Capt. Henry


Cooke, Robert
Grant, Anthony
Kershaw, Anthony


Cooper-Key, Sir Neill
Grant-Ferris, R.
Kimball, Marcus


Costain, A P.
Gresham Cooke, R.
King, Evelyn (Dorset, S.)


Craddock, Sir Beresford (Spelthorne)
Grieve, Percy
Kirk, Peter


Crawley, Aldan
Griffiths, Eldon (Bury St. Edmunds)
Kitson, Timothy




Knight, Mrs. Jill
Orr, Capt. L. P. S.
Summers, Sir Spencer


Lambton, Viscount
Orr-Ewing, Sir Ian
Taylor, Sir Charles (Eastbourne)


Lancaster, Col. C. G.
Osborn, John (Hallam)
Taylor,Edward M.(G'gow,Cathcart)


Langford-Hott, Sir John
Osborne, Sir Cyril (Louth)
Taylor, Frank (Moss Side)


Legge-Bourke, Sir Harry
Page, Graham (Crosby)
Teeling, Sir William


Lewis, Kenneth (Rutland)
Page, John (Harrow, W.)
Temple, John M.


Lloyd, Ian (P'tsm'th, Langstone)
Pardoe, John
Thatcher, Mrs. Margaret


Lloyd, Rt. Hn. Selwyn (Wirral)
Pearson, Sir Frank (Clitheroe)
Thorpe, Jeremy


Longden, Gilbert
Peel, John
Tilney, John


Loveys, W. H.
Percival, Ian
Turton, Rt. Hn. R. H.


Lubbock, Eric
Peyton, John
van Straubenzee, W. R.


McAdden, Sir Stephen
Pike, Miss Mervyn
Vaughan-Morgan, Rt. Hn. Sir John


MacArthur, Ian
Pink, R. Bonner
Vickers, Dame Joan


Maclean, Sir Fitzroy
Pounder, Rafton
Wainwright, Richard (Colne Valley)


Macleod, Rt. Hn. Iain
Powell, Rt. Hn. J. Enoch
Walker, Peter (Worcester)


Macmillan, Maurice (Farnham)
Price, David (Eastleigh)
Walker-Smith, Rt. Hn. Sir Derek


Maddan, Martin
Prior, J. M. L.
Wall, Patrick


Maginnis, John E.
Pym, Francis
Walters, Dennis


Marples, Rt. Hn. Ernest
Quennell, Miss J. M.
Ward, Dame Irene


Marten, Neil
Ramsden, Rt. Hn. James
Weatherill, Bernard


Maude, Angus
Rawlinson, Rt. Hn. Sir Peter
Webster, David


Maudling, Rt. Hn. Reginald
Rees-Davies, W. R.
Wells, John (Maidstone)


Mawby, Ray
Renton, Rt. Hn. Sir David
Whitelaw, Rt. Hn. William


Maxwell-Hyslop, R. J.
Ridley, Hn. Nicholas
Wills, Sir Gerald (Bridgwater)


Mills, Peter (Torrington)
Ridsdale, Julian
Wilson, Geoffrey (Truro)


Mills, Stratton (Belfast, N.)
Roots, William
Winstanley, Dr. M. P.


Miscampbell, Norman
Rossi, Hugh (Hornsey)
Wolrige-Gordon, Patrick


Monro, Hector
Royle, Anthony
Wood, Rt. Hn. Richard


Morgan, Geraint (Denbigh)
Russell, Sir Ronald
Woodnutt, Mark


Morrison, Charles (Devizes)
St. John-Stevas, Norman
Woreley, Marcus


Munro-Lucas-Tooth, Sir Hugh
Scott, Nicholas
Wylie, N. R.


Murton, Oscar
Sharples, Richard
Younger, Hn. George


Nabarro, Sir Gerald
Shaw, Michael (Sc'b'gh &amp; Whitby)



Neave, Alrey
Sinclair, Sir George
TELLERS FOR THE AYES


Nicholls, Sir Harmar
Smith, John
Mr. David Mitchell and Mr. More.


Nott, John
Stainton, Keith



Onslow, Cranley
Stodart, Anthony





NOES


Abse, Leo
Chapman, Donald
Fernyhough, E.


Albu, Austen
Coe, Denis
Fletcher, Raymond (Ilkeston)


Allaun, Frank (Salford, E.)
Coleman, Donald
Fletcher, Ted (Darlington)


Alldritt, Walter
Concannon, J. D.
Foley, Maurice


Allen, Scholefield
Conlan, Bernard
Foot, Sir Dingle (Ipswich)


Anderson, Donald
Corbet, Mrs. Freda
Foot, Michael (Ebbw Vale)


Archer, Peter
Craddock, George (Bradford, S.)
Ford, Ben


Armstrong, Ernest
Crawshaw, Richard
Forrester, John


Atkins, Ronald (Preston, N.)
Cronin, John
Fowler, Gerry


Atkinson, Norman (Tottenham)
Crosland, Rt. Hn. Anthony
Fraser, John (Norwood)


Bacon, Rt. Hn. Alice
Crossman, Rt. Hn. Richard
Fraser, Rt. Hn. Tom (Hamilton)


Bagier, Gordon A. T.
Cullen, Mrs. Alice
Freeson, Reginald


Barnett, Joel
Dalyell, Tam
Galpern, Sir Myer


Beaney, Alan
Darling, Rt. Hn. George
Gardner, Tony


Belienger, Rt. Hn. F. J.
Davidson, Arthur (Accrington)
Garrett, W. E.


Bence, Cyril
Davies, Dr. Ernest (Stretford)
Ginsburg, David


Benn, Rt. Hn. Anthony Wedgwood
Davies, G. Elfed (Rhondda, E.)
Gordon Walker, Rt. Hn. P. C.


Bennett, James (G'gow, Bridgeton)
Davies, Harold (Leek)
Gray, Dr. Hugh (Yarmouth)


Bidwell, Sydney
Davies, Ifor (Gower)
Greenwood, Rt. Hn. Anthony


Binns, John
Davies, Robert (Cambridge)
Gregory, Arnold


Bishop, E. S.
Davies, S. O. (Merthyr)
Grey, Charles (Durham)


Blackburn, F.
Delargy, Hugh
Griffiths, Rt. Hn. James (Llanelly)


Blenkinsop, Arthur
Dell, Edmund
Gunter, Rt. Hn. R. J.


Boardman, H.
Dempsey, James
Hale, Leslie (Oldham, W.)


Booth, Albert
Dewar, Donald
Hamilton, James (Bothwell)


Boston, Terence
Diamond, Rt. Hn. John
Hamling, William


Bottomley, Rt. Hn. Arthur
Dickens, James
Hannan, William


Boyden, James
Dobson, Ray
Harper, Joseph


Braddock, Mrs. E. M.
Doig, Peter
Hart, Mrs. Judith


Bradley, Tom
Driberg, Tom
Haseldine, Norman


Bray, Dr. Jeremy
Dunn, James A.
Hattersley, Roy


Brooks, Edwin
Dunnett, Jack
Hazell, Bert


Broughton, Dr. A. D. D.
Dunwoody, Mrs. Gwyneth (Exeter)
Heffer, Eric S.


Brown, Rt. Hn. George (Belper)
Dunwoody, Dr. John (F'th &amp; C'b'e)
Henig, Stanley


Brown, Hugh D. (G'gow, Provan)
Eadie, Alex
Herbison, Rt. Hn. Margaret


Brown,Bob(N'c'tle-upon-Tyne,W.)
Edelman, Maurice
Hilton, W. S.


Brown, R. W. (Shoreditch &amp; F'bury)
Edwards, Rt. Hn. Ness (Caerphilly)
Hobden, Dennis (Brighton, K'town)


Buchan, Norman
Edwards, Robert (Bilston)
Hooley, Frank


Buchanan, Richard (G'gow, Sp'burn)
Edwards, William (Merioneth)
Horner, John


Butler, Herbert (Hackney, C.)
Ellis, John
Houghton, Rt. Hn. Douglas


Butler, Mrs. Joyce (Wood Green)
English, Michael
Howarth, Harry (Wellingborough)


Callaghan, Rt. Hn. James
Ennals, David
Howarth, Robert (Bolton, E.)


Cant, R. B.
Ensor, David
Howie, W.


Carmichael, Neil
Evans, Albert (Islington, S.W.)
Hoy, James


Carter-Jones, Lewis
Evans, Ioan L. (Blrm'h'm, Yardley)
Hughes, Rt. Hn. Cledwyn (Anglesey)







Hughes, Hector (Aberdeen, N.)
Mikardo, Ian
Rowlands, E. (Cardiff, N.)


Hughes, Roy (Newport)
Millan, Bruce
Ryan, John


Hunter, Adam
Milne, Edward (Blyth)
Shaw, Arnold (Ilford, S.)


Irvine, A. J. (Edge Hill)
Mitchell, R. C. (S'th'pton, Test)
Sheldon, Robert


Jackson, Peter M. (High Peak)
Molloy, William
Shinwell, Rt. Hn. E.


Jay, Rt. Hn. Douglas
Moonman, Eric
Shore, Peter (Stepney)


Jeger, George (Goole)
Morgan, Elystan (Cardiganshire)
Short, Rt. Hn. Edward(N'c'stle-u-Tyne)


Jenkins, Hugh (Putney)
Morris, Alfred (Wythenshawe)
Short, Mrs. Renée(W'hampton,N.E.)


Johnson, Carol (Lewisham, S.)
Morris, Charles R. (Openshaw)
Silkin, Rt. Hn. John (Deptford)


Johnson, James (K'ston-on-Hull, W.)
Morris, John (Aberavon)
Silkin, Hn. S. C. (Dulwich)


Jones, J, Idwal (Wrexham)
Moyle, Roland
Silverman, Julius (Aston)


Judd, Frank
Murray, Albert
Silverman, Sydney (Nelson)


Kelley, Richard
Neal, Harold
Skeffington, Arthur


Kenyon, Clifford
Newens, Stan
Slater, Joseph


Kerr, Dr. David (W'worth, Central)
Norwood, Christopher
Small, William


Lawson, George
Oakes, Gordon
Snow, Julian


Leadbitter, Ted
O'Malley, Brian
Spriggs, Leslie


Ledger, Ron
Oram, Albert E.
Steele, Thomas (Dunbartonshire, W.)


Lee, Rt. Hn. Frederick (Newton)
Orbach, Maurice
Strauss, Rt. Hn. G. R.


Lestor, Miss Joan
Orme, Stanley
Taverne, Dick


Lewis, Arthur (W. Ham, N.)
Oswald, Thomas
Thomas, George (Cardiff, W.)


Lewis, Ron (Carlisle)
Owen, Dr. David (Plymouth, S'tn)
Thornton, Ernest


Lipton, Marcus
Owen, Will (Morpeth)
Tinn, James


Lomas, Kenneth
Paget, R. T.
Tomney, Frank


Loughlin, Charles
Palmer, Arthur
Tuck, Raphael


Luard, Evan
Pannell, Rt. Hn. Charles
Urwin, T. W.


Lyon, Alexander W. (York)
Park, Trevor
Varley, Eric G.


Lyons, Edward (Bradford, E.)
Parker, John (Dagenham)
Wainwright, Edwin (Dearne Valley)


Mabon, Dr. J. Dickson
Parkyn, Brian (Bedford)
Walden, Brian (All Saints)


McBride, Neil
Pavitt, Laurence
Walker, Harold (Doncaster)


McCann, John
Pearson, Arthur (Pontypridd)
Wallace, George


MacColl, James
Peart, Rt Hn. Fred
Watkins, David (Consett)


MacDermot, Niall
Pentland, Norman
Watkins, Tudor (Brecon &amp; Radnor)


Macdonald, A. H.
Perry, Ernest G. (Battersea, S.)
Weitzman, David


McGuire, Michael
Perry, George H. (Nottingham, S.)
Wellbeloved, James


McKay, Mrs. Margaret
Prentice, Rt. Hn. R. E.
Whitaker, Ben


Mackenzie, Gregor (Rutherglen)
Price, Christopher (Perry Barr)
White, Mrs. Eirene


Mackie, John
Price, Thomas (Westhoughton)
Whitlock, William


Mackintosh, John P.
Price, William (Rugby)
Wigg, Rt. Hn. George


Maclennan, Robert
Probert, Arthur
Wilkins, W. A.


MacMillan, Malcolm (Western Isles)
Pursey, Cmdr. Harry
Willey, Rt. Hn. Frederick


McMillan, Tom (Glasgow, C.)
Randall, Harry
Williams, Alan (Swansea, W.)


McNamara, J. Kevin
Rankin, John
Williams, Alan Lee (Hornchurch)


MacPherson, Malcolm
Redhead, Edward
Williams, Clifford (Abertillery)


Mahon, Peter (Preston, S.)
Reynolds, G. W.
Williams, Mrs. Shirley (Hitchin)


Mahon, Simon (Bootle)
Rhodes, Geoffrey
Williams, W. T. (Warrington)


Mallalieu, E. L. (Brigg)
Roberts, Albert (Normanton)
Willis, George (Edinburgh, E.)


Mallalieu, J. P. W.(Huddersfield, E.)
Roberts, Goronwy (Caernarvon)
Wilson, Rt. Hn. Harold (Huyton)


Manuel, Archie
Roberts, Gwilym (Bedfordshire, S.)
Wilson, William (Coventry, S.)


Mapp, Charles
Robertson, John (Paisley)
Winnick, David


Marquand, David
Robinson, W. O. J. (Walth'stow, E.)
Woodbum, Rt. Hn. A.


Marsh, Rt. Hn. Richard
Rodgers, William (Stockton)
Woof, Robert


Mason, Roy
Roebuck, Roy
Wyatt, Woodrow


Mayhew, Christopher
Rogers, George (Kensington, N.)
Yates, Victor


Mellish, Robert
Rose, Paul



Mendelson, J. J.
Ross, Rt. Hn. William
TELLERS FOR THE NOES:



Rowland, Christopher (Meriden)
Mr. Walter Harrison and Mr. Fitch.

New Clause 10.—(REVIEW OF UNECONOMIC ACTIVITIES.)

(1) If it appears from the statements, notes or information prepared under section 22 of this Act or under any regulations made under the said section 22 or by virtue of any directions given to the Corporation under section (Publication by Corporation of information concerning activities of theirs and of publicly-owned companies) that, over a period of five consecutive years any principal activity (other than an iron and steel activity) carried on under the ultimate control of the Corporation has been carried on at a loss or without making a profit in each of such five years, it shall be the duty of the Corporation forthwith to undertake a review of such activity for the purpose of determining whether such activity should continue to be carried on and to report their conclusions to the Minister.

(2) The Minister shall lay before each House of Parliament a copy any report prepared

under subsection (1) above, together with his observations thereon.—[Mr. Patrick Jerkin.]

Brought up, and read the First time.

Mr. Patrick Jenkin: I beg to move, That the Clause be read a Second time.
Among the several themes which have run through our debates on Second Reading, in Committee and on Report so far has been the belief, which has been hammered home again and again from this side, that a public corporation and a private enterprise company are two entirely different things. The very nature of the two animals is different, and for this reason they require different treatment.
A private company derives its capital from the market, and it has to justify


the capital which it has by the return which it pays on that capital. If it has any hope of attracting new capital, the return must be sufficiently attractive for that purpose. If the company makes losses, the losses fall on the owners. If the capital is lost, it is written off and it is lost and gone for ever, like Clementine. The private company is subject to all the disciplines of the rigours of the capital market, and the sanctions on the failure of a private company extremely powerful and painful. When one reads in the financial Press of the failure of businesses—one has in mind the failure of some insurance businesses featured in the Press in recent weeks—one realises exactly what is meant by the failure of a private concern and the consequences of it.
A public concern, on the other hand, has its capital provided by the taxpayer through the Treasury. In all but the last resort, the return which that capital earns in no way influences the supply of capital. Only when what are basically artificial tests are introduced, such as a required rate of return, a financial target, or whatever it may be called, is it possible to measure the effectiveness of the capital employed. If the concern makes losses, the losses are borne by the taxpayer. Every year, for as far back as one can remember, the Financial Statements presented to the House have contained provision by the taxpayer for the losses of nationalised concerns. If the capital of a nationalised enterprise is lost, it has disappeared but the obligation to pay interest on it continues, and, instead of this interest being paid by the concern which had the capital employed in its business, it is paid by the taxpayer as part of the National Debt, and this continues in perpetuity.
The two are entirely different animals and, in particular, for the reasons I have just given the public concern is from its very nature, subject to far less stringent disciplines. I was very interested yesterday in what my hon. Friend the Member for St. Ives (Mr. Nott) told the House about the advice of Professor Edwards and others as to the possibility of trying to inject into public enterprises some of the disciplines which, in general, are so effective in ensuring the deficiency of the private sector.
The Minister does not accept that this difference in kind exists. He believes that a large public concern can be treated in the same way, or very nearly the same way, as a large private concern. At one point in Committee, he committed himself to a very strange reaction on this question. We were talking about the subject raised by this new Clause, the diversification of activities of the Corporation, and he said:
There is only one major difference between the position in the nationalised industry and the same industry in private ownership, and that is that in the nationalised industry they have to get the Minister's consent to acquiring companies outside the iron and steel field. In the private sector, the Minister has no direct powers.—[OFFICIAL REPORT, Standing Committte D, 10th November, 1966; c. 451.]
The right hon. Gentleman said that in reply to a debate in which the differences I have just described had been impressed throughout. This is extremely important in diversified activities.
In the last new Clause we dealt with the relations of the Corporation to the private sector. In this Clause we deal with fair competition, as much as anything, between the public sector and private sector in the activities other than iron and steel. As my right hon. Friend the Member for Altrincham and Sale (Mr. Barber) said in his closing speech in our last debate, the Corporation's powers to engage in industry and activities outside iron and steel are stupendous. The Minister has gone some way to recognise that in that under the new Clause debated yesterday he will provide certain figures of turnover, capital employed and profits for each diversified activity of the Corporation. We hope that the information will be available to enable Parliament to probe, and competitors to judge, the effectiveness and efficiency of the operation of those activities.
But will there also be the sanction to make sure that a poor performance or a failure meets with the consequences that it should? The purpose of the Clause is to inject into the Bill, in relation to diversified activities, a substitute for the sanction of the market, which is so effective in the case of private concerns. Our proposals on the non-iron and steel activities are modest. We suggest that if a diversified activity is shown by the


statistics which are to be published under the Bill, or as a result of a report which the Corporation will prepare, not to have made a profit or to have had a loss for five consecutive years there will be an obligation on the Corporation to review that activity and prepare a report and present it to the Minister. Then the Minister must pass it on to Parliament with his comments. There is nothing more to it—review, report, and report to Parliament.
In Committee, we moved a rather more stringent and elaborate Clause, at column 2463. We put forward a five-year period, but also sought to import into the Bill the concept of a standard profit which the diversified activity would have to attain. That would have been the average profit for the rest of the trade in private hands. We also provided that if the diversified activity failed to reach that standard there would be an automatic cessation of that activity. The Minister directed harsh criticisms at that proposed Clause.

Mr. Speaker: The hon. Member cannot debate now an Amendment we are not discussing.

Mr. Jenkin: I shall move straight on. The point I wish to make is that the new Clause we now propose goes the whole way to meet all the right hon. Gentleman's criticisms. First, he said that the standards suggested were inevitably haphazard and generally narrowly based. We have abandoned the concept of a standard and in the Clause we now have only the question of whether or not the activity is making a profit.
The standards involved the valuation of the assets, and the right hon. Gentleman described our suggestion of valuation as obscure. But the statistics involve valuation of the assets, because he must determine the capital employed. However, we are happy to accept the Minister's own proposals in his new Clause which became part of the Bill yesterday for the method of determining the capital employed.
The right hon. Gentleman criticised most strongly the proposals we then put before the Committee for automatic cessation after five years if the activities did not come up to the standard. He kept on asking if there were to be no chance

to review and to take account of special circumstances and if there were to be no appeal.
We have abandoned the idea of automatic cessation. The statistics will provide the raw material and commercial judgment may well provide a yardstick to determine whether an activity should go on even though it has made a loss or is not showing a profit. But the point of the Clause is the question which still arises, "What is the sanction?"
There must be a sanction, some pressure, some influence to determine whether or not a loss-making activity should continue. It cannot, of its very nature, be the same as that which applies to the private concern. What then can be the check on management's enthusiasm running away with itself, becoming over-optimistic and always believing, "Although we made a loss last year and the year before, there will be a profit next year. Just round the corner large profits can be earned and, therefore, it is worth while carrying on this activity"? One can go on year after year with losses being made over and over again, and with no effective sanction or pressure to recognise reality and wind up the operation.
7.45 p.m.
There are examples in the coal industry at the moment. The National Coal Board will soon have to face the problem of the Coventry plant making smokeless fuel, which has acquired the soubriquet of "Bronowski's Bullets". It has been pouring millions into corrective engineering on a plant which, I am advised, will never operate successfully as designed. My hon. Friend the Member for Barkston Ash (Mr. Alison) asked at Question Time on Tuesday about the company at Slough, the Draysley Company on which the National Coal Board lost £¼ million because the company produced domestic fuel appliances which turned out to be defective, and ceased to produce that particular model.
There are examples where commendable enthusiasm may take a nationalised industry into activities which it believes may be to its advantage. But it is essential that they should be carefully controlled. In another debate in Committee, on the question of statistics, I described the case of J. H. Sankey and Son,


Ltd., a recent acquisition of the National Coal Board, to which reference was made at page 24, Vol. 2, of the Coal Board's accounts for 1965–66. I then said that there were no proper figures in the Coal Board's report to indicate the financial performance of that company, in which the Board has a 60 per cent. interest J. H. Sankey and Son, Ltd. distributes solid fuel appliances.
I incurred the wrath of one or two of my hon. Friends when I suggested that it was perhaps not an improper acquisition for an industry wishing to continue to press the sale of solid fuel. I adhere to that view, but it must be watched and carefully controlled.
I was therefore more than a little disturbed when I came across an article in a publication which rejoices in the name of Sankey News, a news sheet that circulates in the firm. The article was headed, "Just Partners …'", with a sub-heading, "And 'eager to help' says Robens", and was accompanied by a picture of Lord Robens, addressing what we are told is a large number of the staff at one of the premises of Sankey's
The article starts:
Commercial links that the National Coal Board make with private firms like Sankey's do not mean that the Board wishes to be a big brother' but an eager-to-help 'partner on the basis of complete equality'".
Lord Robens is quoted as saying:
We are not out to run people out of business. In pursuing the commercial objects of the Coal Board we…will be able to improve the homes of the people. It is something a great deal more than sheer commercial enterprise.
He went on to describe in glowing and enthusiastic terms what the objects of the partnership will be.
I do not wish, in drawing attention to this, in any way to cast any doubts at all on the wisdom or correctness of the National Coal Board in going into that acquisition. It is true that the figures quoted in the National Coal Board's Report show that the Board has invested over £1 million and that in 1965 the total profit of J. H. Sankey and Son Ltd. was £7,257 before tax. But there is exactly the sort of sentence that I am frightened of and to which we must have regard when considering the new Clause:

Substantially increased profits are, however, expected for 1966 as the company benefits from the developments which have taken place in 1965.
I shall read with very great interest the next accounts of the National Coal Board to see what has happened to J. H. Sankey and Son Ltd. and whether the hopes and expectations which the Board had for this enterprise have turned out in the event. But suppose they do not. Suppose the enterprise fails. It should be remembered that the National Steel Corporation has vastly wider powers to go into these diversified activities than the National Coal Board, whose objects clauses are very very circumscribed.
The venture was launched, as was clear from Sankey News and the quotations that I have given from Lord Robens, in a blaze of high enthusiasm. I do not blame the noble Lord for that; he is very good at that sort of thing. But it would be a terrible temptation for the managers of this concern when faced with what might turn out to be losses—I say this purely as a matter of hypothesis and not in any sense as a matter of forecast—to soldier on for some years as the losses mount up. There is no effective sanction on the National Coal Board to bring this sort of thing to an end.
The new Clause is intended to provide what in these circumstances can be the only effective sanction—publicity—to ensure that the matter is brought to the notice of those responsible, that the Minister becomes aware of it, that Parliament becomes aware of it and that Parliament can then use all the means of Parliamentary pressure on the Minister to ensure that proper consideration is given to it.
I do not say that this would necessarily and automatically lead to the closure of a business. Indeed, I felt that there was some force in what the right hon. Gentleman said—all the same, five years is a long time—that there should not be automatic closure. Our new Clause meets every single objection which the Minister advanced to the comparable new Clause that we moved in Committee. We have set no rigid standard. We have no automatic closure. All we want to do is to ensure that the case should be reviewed and that there should be a report on it.
The broad financial targets were also relied upon by the Minister. The required rate of return is not enough to take account of the individual, separate diversified activities. That may be right with the financial discipline on the Corporation as a whole, but it does not touch this problem. The only way in which this problem can be dealt with—it is a real problem, one which has worried bodies like the C.B.I. for some years—is by publicity. This is what the new Clause is intended to do. I believe that it would be a useful, salutary and valuable additional safeguard.

Mr. Nott: I entirely agree with my hon. Friend the Member for Wanstead and Woodford (Mr. Patrick Jenkin) that in both the private sector and the public sector there is always the constant feeling when a company is going wrong that profits are just round the corner; next year will herald some magnificent rise in profitability which was not seen in the previous years. But the next year comes round and the profits do not meet expectations, and so the years go by. In the case of the private sector, the company in due course goes bankrupt, but in the case of the public sector it goes on being bolstered up by the taxpayer year after year.
I also agree entirely with my hon. Friend that the new Clause is completely innocuous. All that it requires the Ministry to do is to carry out a review of the company after it has been making losses for five years and to lay that review before Parliament. I cannot think of any conceivable reason why it should be rejected. Surely, financial control in the public sector must be something which both parties require and desire, and, after all, information lies at the heart of financial control.
I declare a personal interest. I was very much involved in the Sankey transaction at the time that the National Coal Board took an interest in it. I drafted the Press statement on behalf of the National Coal Board and Sankey to which my hon. Friend referred, and the blaze of publicity to which he referred was as a result of my drafting. So I am very much aware of the details of the Sankey transaction, and I entirely agree with my hon. Friend in what he says about it.
One thing can be said about the Sankey situation however, and that is that its

accounts are still filed in the Companies Registry, because the National Coal Board does not own the whole of Sankey. It only has control. Thus the accounts of Sankey can still be seen in the Companies Registry. We can still go along there and get a true idea of how the company is doing.
But what happens is that as soon as a firm like Sankey becomes wholly owned by a nationalised industry and no longer files its accounts in the Companies Registry, it enters into a murky darkness and no one has the slightest idea how much cross-subsidisation there is, how many special rebates there are and precisely what is going on. I am sure that it must be recognised that, although we are told by the electricity boards and the National Coal Board that they produce subsidiaries' accounts at arm's length from one another, in practice there are cross-subsidisation and special rebates as between one company and another.
Therefore, I suggest that the Clause is completely innocuous and that the Minister cannot object to it. It merely seeks information and a review of the activities of loss-making companies which are outside the production of iron and steel, and it requires the Minister to lay the review before Parliament. Surely this meets the objectives which all parties in the House are trying to achieve in the public sector.

Mr. Michael Shaw: I wholeheartedly support my hon. Friend the Member for Wanstead and Woodford (Mr. Patrick Jenkin). On the question of not being able to see the accounts if a company is taken over wholly by the Corporation, I would tell my hon. Friend the Member for St. Ives (Mr. Nott) that this will not apply in this case, because these accounts will still be filed at Company House. There is a difference in that respect.
The interesting point about the new Clause is that it does not necessarily deal with a separate company. It deals with any principal activity. This is important in considering the matter because there is the very real problem of cross-subsidisation with which we have been very much concerned throughout our deliberations in Committee. There remains the very difficult problem of trying to judge whether the company is achieving a fair return on the capital used. To judge that exactly by means of a report to Parliament is very difficult. We thus have to


have a fairly rough measure by which to gauge it and, of course, that measure is whether or not there is a profit.
8.0 p.m.
I prefer this new Clause to the Amendment that we moved in Committee. It would mean that a report would be made and a justification sought for the continued losses rather than that the company would cease altogether. That is a preferable course because, as I know from my own experience, many companies or activities are carried on by a group although they do not make a great profit. But this is balanced by their value to the group being very great indeed. For example, they may be getting rid of some waste matter at a better price than the main companies would get. Very often the profitability of a company cannot be judged on its own but only in relation to group profits as a whole.
Of course, there is always an explanation and in such a case the information would come before this House and an explanation be given. But one thing is certain. In private industry, an activity of this nature is watched very closely indeed and is checked with competitors' prices to see whether or not, due to new circumstances, the company ought now to be closed down.

Mr. Kenneth Lewis: My hon. Friend knows a great deal about these things as an accountant. If a company is selling to the main company and not outside then presumably the main company ought to pay the proper price for the service that it is getting. Although there may not be a profit, there should not be a loss. If that is so, I cannot see why this should not be the case under the N.S.C. A product should not be sold by such a company at a loss which the public has to pay for.

Mr. Shaw: We have been trying to ensure that all transactions are arm's length transactions, because otherwise this would put the subsidiary company in an advantageous position as against companies in the private sector also trying to sell to companies within the nationalised group. It is essential to have this type of Clause in the Bill. My hon. Friend asked why should not a company owned by the N.S.C. always sell at a

profit. It may well be that one of the group's processes, for example—I am not very conversant with the steel industry and must be rather theoretical but I have had experience elsewhere—gives off a waste which has little market. But by an additional process a market may be found. It may not be a profitable market but, by sale at just above cost, there is no loss on the disposal of waste which would otherwise be an expensive business to get rid of.
The other case that springs to mind is that of using a subsidiary company to carry on a not very profitable activity. It may be able to make special articles that can be dovetailed in with the main products of the group and so give an additional market which the main company would not otherwise have.
There is the ever-present fear in my mind that, as soon as an industry or company is nationalised, its success becomes a political matter and political reputations are at stake. There is always perhaps the great temptation to "duck" the issue of having to admit that a venture has failed. The disciplines must therefore be present in order to force projects that appear to be failing out into the open for full discussion to see exactly what is going on and for a decision to be made as to whether or not the activity should be continued. I have a great liking for this new Clause and wholeheartedly support it.

Mr. Gresham Cooke: This is the most important new Clause we have been discussing today and perhaps attracts me more than any of the others. The most difficult decision that any businessman has to make, and which he hates to make, is to close anything down—for example, a piece of research which has gone on for several years with great hopes. There is always great reluctance to close down a works. Hon. Members should think of the fuss when a branch line is closed down. I can give two examples from the steel industry.
I was secretary of the United Steel Company before the war. It owned the Workington Iron and Steel Company, a very large concern which for a long time made a loss for almost every year up to 1938. The Parliamentary Secretary tells us about hard and greedy capitalists but in my view they are not hard enough.
Every year before the war the position was reviewed by the board of directors, who considered whether the Workington Iron and Steel Company should be closed down. But then the chairman and others would say, "What about the 5,000 men employed there and all the collieries and ore mines dependent upon it?" The company was not closed down—probably rightly, because, in the end, the war came and it was useful then. After the war, when the great shell-making plant erected at Distington became empty, that was taken over by United Steel as an engineering plant for coal mining machinery and now it makes steel-making machinery. I do not know the position now but the plant did not make money for the first year or two after the war. That sort of fringe activity must be looked at every few years to see whether it should be carried on in an area a long way from possible markets of other steel companies. We in Parliament should know whether fringe activities like Distington are really profitable.
In the steel industry there are many temptations to take on other companies. I remember that a serious proposition was put up in United Steel when it was said that because the men in the melting shop drank a lot of beer we should take shares in a local brewery so as to have a lien on the supplies of beer. We acquired an outside company which had a little chain of ironmongers shops. It was kept for some time, although I expect that it has been got rid of now. That is the kind of thing which happens in big groups, and these things are acquired almost by accident.
I hope that the Parliamentary Secretary will give us some concession and say that he will tell Parliament about these fringe activities which may or may not be profitable and which may be carried on in areas in which there is no natural market and from which tens of hundreds, if not hundreds of thousands, of pounds can be quickly lost. I regard the new Clause as extremely important and I hope that it will receive the commendation of the House.

Mr. Kenneth Lewis: I hope that the Parliamentary Secretary will make a concession and accept the new Clause, or declare his intention to provide a similar

provision in another place. If he is in any doubt, he should make the concession as a salute to his old office and his last parting shot on the Bill, as his last contribution to it. I shall think a good deal of him if he does and he will be doing a great public service. He should tell the Minister that he requires this opportunity to make a contribution at this late stage. This is a reasonable and realistic Clause, so reasonable that I do not think that it goes far enough, but I am prepared to accept it, and therefore the Parliamentary Secretary should.
It applies to activities not connected with iron and steel production, subsidiary activities. It is concerned with the Bill's diversification provisions. I do not support that diversification and I am suspicious of it. The Tory Party as a whole is suspicious of it and I think that the country is. If the Parliamentary Secretary and the Minister want to get rid of that suspicion, they can help themselves to do so by accepting the new Clause. If they do not it will be apparent to the country that they want to cloak the losses, that they do not want to tell the House of Commons and to issue reports about losses.
My hon. Friend the Member for Wan-stead and Woodford (Mr. Patrick Jenkin) was extremely generous when he said that subsidiary companies of nationalised industries would often carry a loss, hoping to make a profit. Unhappily, they carry a loss whether they hope to make a profit or not. They are inclined to carry losses willy nilly. My hon. Friend the Member for Scarborough and Whitby (Mr. Michael Shaw) said that political reputations depended on losses in the nationalised industries and that political reputations had been broken because of them. In the last few years, it seems to me, political reputations have been made on losses in nationalised industries.
8.15 p.m.
The public has not been assisted by those losses, for the public has had to pay the bill. The taxpayer, the ordinary man on his "pay-as-you-earn" and the executive who has to pay high Income Tax and who then gets drubbed for Surtax and then a 10 per cent. surcharge on his Surtax, have to pay the losses of the nationalised industries, which are bad enough in all conscience. If to those


losses are added the losses from subsidiary activities, the whole exercise will be made a nonsense.
In private enterprise business, when a company is started it is normally expected that a loss will be made in the first and second years, breaking even in the third year, with a profit then starting to be made. We are asking for a report in the fifth year, so we are being generous to the nationalised industries and giving the Corporation an opportunity not normally available to free enterprise, which is expected to make a profit much sooner than five years.
If a company under the Corporation is not making a profit in five years, whether engaged in some activity which may be marginally useful to the Corporation or not, at least it should be put on the market. At least the Minister should take the view that he is justified in directing the Corporation to sell that company to free enterprise, if free enterprise will buy it, because a free enterprise company might be able to make it pay, while the Corporation could not do so, being too busy producing iron and steel.
About five years ago, diversification used to be very popular. Many of our large private enterprise companies diversified all over the place, thinking that that was the way in which to maintain their profits. They are now doing exactly the reverse and many of our big corporations are getting rid of their fringe activities because they cannot run them well, because it has come home to them that the cobbler should stick to his last. The Corporation's job is to produce iron and steel at a profit and not to go into all sorts of outside activities.
I do not like that power being in the Bill at all, but, if it is, let us consider it from time to time to make sure that these losses are not becoming repetitive. There are all sorts of reasons why a nationalised industry would put up with losses when a private enterprise industry could not or would not do so. It might be loth to get rid of certain executives, the managers of the subsidiary companies. After all the Minister and the party opposite must be as aware as we are that when an industry is nationalised, people are inclined to regard it as a Civil Service set-up and to say, "We cannot be sacked; we cannot be thrown

out". The people at the top take the view that they ought not to dismiss an employee or group of employees because the industry is a State concern, and they put up with losses, maintaining staffs which are not always justified.
Then there are losses created by a subsidiary company of the Corporation because there is a desire to compete with free enterprise and to create a kind of loss leader situation, for loss leaders are to be found not only in supermarkets. They can be found in nationalised industries which want to cut profits and make it difficult for free enterprise. It may be making it difficult for free enterprise companies which are exporting, and that would not be to the advantage of the Government any more than to the advantage of the iron and steel industry in the long run, because the markets for its main activities would be found to be running down.
There is no question but that the losses of our nationalised industries are a scandal. I do not think that the Government will tackle it, but certainly it is something which we shall have to tackle when we get back to office. I am against the Bill, because I think that it will create another industry loading losses on the public purse. We have to stomach that because we are outnumbered, but at least let the Government give us credit for wishing this industry to review its diversified interests, its activities which are making losses for which the public will have to pay and which, if hived off to free enterprise, might be profitable. I hope that the Minister will accept the new Clause.

The Joint Parliamentary Secretary to the Ministry of Technology (Dr. Jeremy Bray): Neither the Minister nor the Corporation would wish the steel industry, under its management, to continue for one moment any unessential activity which was unprofitable and which could be wound up. This is obvious common sense. It is surely unnecessary to spell out in the Bill the A.B.C. of management to the Corporation. There will be the overall financial objectives. These will he clearly laid down, they will be debatable, they will be monitored and subjected to a degree of scrutiny to which no shareholders' meeting every subjects its board of directors. In addition, there will be a degree of disclosure which will at


least match that required by the Companies Bill and, in many respects, go far beyond it.

Mr. Nott: Can the Parliamentary Secretary say how the disclosure will go far beyond that contained in the Companies Bill?

Dr. Bray: Because the interpretation of the Companies Bill will be a matter for the courts, whereas the interpretation of the terms of this Bill will be subjected to the Minister's instructions and the Minister will be answerable to Parliament. If it is said that this is unrevealing I would like hon. Members opposite to examine the reports of the nationalised industries, to examine reports of Select Committees of this House and to look anywhere in private industry to produce a comparable degree, not only of disclosure of the accounts, but of examination of the technical information and the structure of management, of the whole complex operation of the industry.

Mr. Kenneth Lewis: The Parliamentary Secretary is dealing with the situation affecting nationalised industries as we have them. In the Bill, we are dealing with a new situation. It is what all the battle upstairs has been about. There will be a great deal more diversification. The House cannot accept the pattern of the past as the pattern for this. The Parliamentary Secretary must say that he will go a good deal further than the present system affecting nationalised industries if he is to convince us that he is realistic in his approach to this matter.

Dr. Bray: I entirely take the hon. Member's point. As the hon. Member for Worcestershire, South (Sir G. Nabarro) said yesterday, we go far beyond the measures in any previous nationalisation Statute in the statutory disclosure required. It is evidence of this to some extent that the Opposition Amendment that we are now debating relies on the degree of disclosure in the Bill for identifying where there is a possibly unprofitable activity which ought to be wound up.
This is not a matter of dispute between the two sides—at least not a fundamental difference. The volume of turnover at which one draws the line is a matter for experience. The principle is agreed between us about the type of degree of disclosure required. If there is disclosure

how effective is the response of the ultimate sanction, the instructions of the Minister in the case of the National Steel Corporation or the pressures on the management of a private company? Hon. Gentlemen opposite have today, and at every previous stage in the debate on this Bill, referred to the National Coal Board plants to make "Homefire" and "Roomheat".
This project will not be caught by the terms of this Amendment, because it is a capital project, and there has been no trading account in respect of these projects upon which any loss could have occurred. This is not just a quibble, because it is the questionable investments which need to be examined, either direct purchasing of already existing operations, companies, and so on, or the actual physical building of plant, where the most careful scrutiny needs to be made. It is here that the criteria by which the Minister exercises his responsibilities in relation to the Corporation will be decisive.
If we look at the record of the Coal Board it is now closing down more uneconomic capacity in respect of total volume of its uneconomic operations than any sector of British industry. We have a redevelopment programme in the Coal Board, in the closure of pits, against the most extreme social considerations and political pressures of all kinds, which is if anything, evidence that this kind of programme can be carried out with a degree of economic reality possibly greater than that which many private companies—I except many private steel companies in their exercise of social responsibility—have felt able to carry out. Why? Because it is possible to fit in with other aspects of Government economic policy in relation to regional development, public expenditure in certain areas and so on.
The theory which hon. Members have held in this debate is that private industry is a fundamentally different situation in respect of possible uneconomic activity from that of the nationalised industries, and that there is a kind of pressure on the private firm to review its uneconomic activities, to see whether they should be discontinued. The type of situation to which this Clause refers—a sustained loss for a long period over a particular trading activity—reflects in many instances a


degree of cross-subsidisation, where although a certain operation is not profitable, other operations of the group to which the company belongs are profitable.
Consider the degree of cross-subsidisation in the oil industry. For example, why did Distiller's find it desirable to dispose of its chemical interests to British Petroleum? Why has I.C.I., following up its petro-chemical interests, found it desirable to go into oil refining operations? It is very well known that there is a network of integration of industrial activities which does not always rest on the technical economies of the situation, where there is a certain amount of bargaining of strength from commercial positions behind it.
From the national point of view as well as from the point of view of the balance of payments, this is not always undesirable. There is at least one steel company with steel-producing and steel-using companies which exports at an apparent loss in respect of one particular sector of its activities. But it is in the interests of the group to operate in this way and in the interests of the balance of payments.
If this is the situation because it is in private industry, and if it may sometimes be genuinely right that it should do so then a situation can well arise where it would be right that the National Steel Corporation should do so. Hon. Gentlemen opposite accept this. What they are asking is that this situation revealed, by information published as required by the terms of this Bill, should be further probed by a review—let us say over five years in the case of a recurring situation, but certainly not more than five years in the case of a new situation—and that that review should be published. That the review will go on is indubitable.
8.30 p.m.
Hon. Members opposite who have taken part in scrutinising the accounts of the nationalised industries know that when a trading activity shows a loss it is a matter of course that it is examined most carefully by the Department responsible for the nationalised industry concerned. In this case, it would be examined most carefully by the Ministry of Power. It will be examined with a greater degree of toughness, with the Treasury looking

over the Ministry of Power's shoulder, than happens in most private companies.
Therefore, the review will go ahead and will penetrate the economics of the situation in terms of the profitability of the Corporation and of the national interest. It will be carried out at a time when there is debate on these activities in the House, in the Press and in industry. If there is a situation which should be brought to an end, surely the pressures of the circumstances are sufficient to do this.

Mr. Gresham Cooke: Has the hon. Gentleman considered this point? The pressures of the Press, Parliament and Select Committees, will be on the iron and steel-making activities. Those are what everyone will be talking about. Has the hon. Gentleman considered whether these fringe activities will be considered at all?

Dr. Bray: I do not think that it is the view of anyone who has sat through all the stages of the Bill that attention will be focused simply on the iron and steel activities. A great deal of interest will be focused on other activities, and it is right that this should be so.
I ask myself why the Opposition are pressing this proposal. If it is through concern for the objective management of the affairs of the Corporation by accepted good business criteria, then their point is met by the Bill as drafted. I cannot think that they are pressing their proposal out of any wish to put British industry at a disadvantage in relation to its overseas competitors in any arrangement which might produce an apparent loss in one of the Corporation's activities.

Mr. Kenneth Lewes: I am puzzled about a comment which the hon. Gentleman made just now. Is he suggesting that some excuse will be made of secrecy on losses? This was the impression which he gave. He suggested that we on this side of the House were trying to put these subsidiaries in a worse position vis-à-vis their competitors. The only way in which we could do that would be by pressing that they should open their books and disclose their balance sheets and profit and loss accounts.

Dr. Bray: There will be full disclosure to the extent required by the Bill. It is


on this disclosure which the new Clause rests. The point about whether there should be a deep special inquiry into a particular operation and that the results of that inquiry should be laid before the House requires a degree of examination of a possible commercial situation which hon. Members opposite, if they were in power, would not always wish inevitably to draw to the attention of overseas competitors.

Mr. Nott: I suppose that the hon. Gentleman realises that what he is saying is in almost complete contradiction to the philosophy behind the Companies Bill which his own Government are to bring before the House in the next few weeks. If he says that complete disclosure would give something away to foreign competitors, he is talking in completely contradictory terms to the Companies Bill.

Dr. Bray: If the Opposition claim that there is no difference between the review which they want to have carried out and the information which they wish to be published—which will be published anyway—there is no point in the new Clause. Presumably what they mean by "a review" is something which goes into greater detail and which gives deeper consideration to the commercial situation. We accept that an apparent loss may be shown in a particular activity. If hon. Members opposite wish to see the reason for that fully and exhaustively explored in a public inquiry and the results of that inquiry published, then this is the kind of exercise which they would not wish to have carried out when it affected the question of overseas competition.

Mr. Kenneth Lewis: I do not know whether the hon. Gentleman has read the new Clause. There is nothing in it about an inquiry. It simply asks that a duty should be imposed on the Corporation
forthwith to undertake a review of such activity
The hon. Gentleman is making much more of this than we are. He is trying to suggest we want an inquiry. For myself, I ask: why not? If an activity is making a loss, I cannot see why there should be any objection to an inquiry. But we are not asking for that. We are asking that directions should be given to the Corporation to undertake a review. This is reasonable in all con-

science. The hon. Gentleman is simply trying to justify rejection of our proposal by going off at a tangent and suggesting that we are asking for something that is not in the Clause.

Dr. Bray: Let us not quarrel about the words. The review is to be carried out. This is to result in a report to the Minister. Under subsection (2) of the new Clause the report is to be laid before each House of Parliament. That is what I meant by an inquiry. This was simply an aside. I concluded that there were situations in which hon. Members opposite would not wish to have carried out the kind of review which might result from the new Clause.
The only remaining reason for hon. Members opposite pressing the new Clause is that they are perhaps seeking to protect a private firm from competition from public enterprise in a way in which they would not protect it from competition from another private enterprise concern. They are basically concerned, not with the efficiency of management of the Corporation, but with the competitive relations between the Corporation and private industry. I accept that the terms on which the Corporation competes with private industry should be the same as the terms on which private industry competes with private industry. We have said that repeatedly. The Minister has said it over and over again throughout our debates on the Bill. The new Clause would go further than that. It would put the Corporation in a different position from private firms in competition with other sectors of industry.
It has been said that, because the Corporation is different from private firms in one way, it must therefore be put in a different competitive position in another way. It is a matter of judgment as to where the balance lies between this grievance and the method of redress. My argument is that the method of redress has not been related to the kind of situation which the hon. Gentleman fears constitutes the main difference between the private and public sectors.
I accept that this is a difference of judgment. Hon. Members opposite have perhaps begun to appreciate that we wish the Corporation to act in a fully competitive way, being thoroughly businesslike in its own management, completely realistic


in the appraisal of its activities and governed by commercial criteria in its operations. But we do not want to see the National Steel Corporation subjected to a kind of constraint which would limit it in a way in which private enterprise would not be limited.
If, therefore, the new Clause is pressed, I must advise my hon. Friends to resist it.

Mr. Patrick Jenkin: I appreciate that the Joint Parliamentary Secretary has tried to deal with some of the points which were made by my hon. Friends and myself in the debate. I also appreciate that there is some force in one or two of the points which he put, and I will come to them later. But I challenge some of the arguments which he addressed to the House in seeking to resist both this Clause and apparently any other Clause like it.
The hon. Gentleman mentioned the "Homefire" and "Roomheat" project. The fact is that this plant is not yet trading—if a plant can trade; it is not yet producing anything. I find it a strange argument to suggest this plant as a reason for not including the new Clause in the Bill. I find it a strange argument that because one cannot catch the case of the capital investment which is not yet trading, therefore one should make no attempt to catch the case in which the capital investment is trading and making a loss. It may well be that in this respect the Clause requires strengthening, but as an argument for not accepting the Clause—especially taken in conjunction with the hon. Member's other arguments —it was strange.
Nor is his argument about the National Coal Board closures in any way germane. As my hon. Friend the Member for Twickenham (Mr. Gresham Cooke) rightly said, attention will always be directed to the main activities of a nationalised corporation. This has happened in recent years in the National Coal Board. As part of a national energy policy, the economics of the different areas and divisions of the Coal Board have been examined very closely, and there is now in train a substantial programme, which I believe will have to be an accelerated programme, of pit closures in order to achieve what the

Minister said he seeks—a viable and profitable coal industry in this country.
I therefore do not accept that argument. The next argument was about cross-subsidisation. This is the kind of case that can arise in these diversified activities where there is crosssubsidisation—where some part of the overhead is being borne in a certain activity, and if that activity were closed down the overhead would have to be borne somewhere else. The argument continues that it is worth carrying on the activity in order to prevent that overhead from being transferred to another part of business. This is often a false argument, but it is an argument used to justify public and private enterprise in carrying on activities which on their merits ought to be closed.
The hon. Member sought to rely on the argument about the Parliamentary pressure which would arise from the disclosures which are being written into the Bill. I question how effective they can be. It has been calculated that an industry comes under the eagle eye of the full Select Committee on Nationalised Industries once every 12 or 14 years. There may be plans to step that up, but with the increase in the nationalised industries, that is the kind of period which is likely.
Similarly, my hon. Friend the Member for Worcestershire, South (Sir G. Nabarro) is always complaining of the limited opportunity to put Parliamentary Questions on the day-to-day management of the nationalised industries. We have a debate on the Floor of the House every two or three years on the borrowing powers for each of these industries. This is about what it amounts to, and it certainly cannot be relied on as adequate justification for not examining the profitability of the subsidiary, ancillary activities of a nationalised industry, certainly not an industry which is to have the vast and sweeping powers of diversification which the National Steel Corporation will have under the Bill.
I accept that the statistics here will be much more than have ever been provided for—and that is right—particularly on the question of the profits and capital employed in diversification activities. However, I really cannot accept the argument that it is an adequate substitute


for the pressure which exists on private industry to wind up non-profit-making activity.
8.45 p.m.
The Minister said in the Standing Committee:
I accept the arguments which have been made in the past, to some extent at any rate, on the lack of information; and if that information is available, those companies should be open to no less pressure than any private company but certainly should not be open to any more pressure."—[OFFICIAL REPORT, Standing Committee D, 15th December, 1966; c. 2488.]
"No less pressure than any private company". What the hon. Gentleman has failed to satisfy me, at any rate, about is that there is adequate pressure which replaces the pressure of the market, the pressure on boards of directors to stop loss-making activities, the disciplines of the capital market. That does not exist to the same extent.
However, there is one point which the hon. Gentleman has made which I do concede, and I am sure my hon. Friends would also concede, has some force in it, and that is we do not in this new Clause give any discretion to the Minister to withhold from publication if publication of the report could be of damage to an export business or, indeed, to the competitive position of an industry. The Clause in that respect is uncompromising. Therefore, I do not think it would be right and I hope my hon. Friends will accept this—that we should press this new Clause to a Division.
I am perfectly certain that we shall study very closely what the hon. Gentleman has said, and no doubt my friends in another place will be able to return to this matter and perhaps at the third attempt get a Clause to deal with this undoubtedly very important aspect, for here we are breaking new ground, and write into the Bill something which will ensure, to an extent which would not otherwise be possible, the Minister's objectives of a fully commercial organisation, which he believes the National Steel Corporation will become. As I say, I hope my hon. Friends will accept that it would not be right, in these circumstances, to press this new Clause to a Division, and I beg to ask leave to withdraw the Motion.

Motion and Clause, by leave, withdrawn.

New Clause 11.—(FURTHER OBLIGATIONS OF THE CORPORATION AND THE PUBLICLY-OWNED COMPANIES.)

Notwithstanding anything in sections 2 and 34 of this Act, neither the Corporation nor a publicly-owned company shall, without the consent of the Minister, make any substantial alteration in the organisation of the activities that, in the case of the Corporation, have fallen to be carried on under their ultimate control or, in the case of a publicly-owned company, are being carried on by that company and its subsidiaries at the date of the passing of this Act, until the first report has been made by the Corporation under section 4(1) of this Act.—[Mr. van Straubenzee.]

Brought up, and read the First time.

Mr. W. R. van Straubenzee: I beg to move, That the Clause be read a Second time.
I shall try to explain so eminently reasonable a new Clause very shortly indeed. You will understand, Mr. Speaker, that to explain it I must make reference to Clause 4 of the Bill, an unhappy Clause for hon. Members opposite to discuss, I realise, a Clause which places upon the Corporation the duty to review its affairs and present a report to the Minister. I draw the attention of the House to the fact that that Clause places upon the Minister, or will place upon the Minister, in addition a duty to place that report before the House. That will be discussed later upon a later Amendment, which stems directly from an undertaking given by the Minister to my hon. Friend the Member for Yeovil (Mr. Peyton)—and that was one of the many great services performed by my hon. Friend to the Standing Committee.
In brief, what the new Clause is now suggesting is that the Corporation should not carry out any substantial reorganisation based on that report till the first report has been made. I draw the attention of the Joint Parliamentary Secretary who, I fancy, is going to reply, to three facets of the wording which, of course, has been carefully chosen. Neither the Corporation nor a publicly-owned company shall act
without the consent of the Minister".
The Minister comes into this. It says that the alterations are limited to "substantial" alterations. The hon. Gentleman will notice the word "substantial". It says that this is limited to the
organisation of the activities".


All those words are important; they all have a purpose behind them; and the importance of them all has, I hope, been taken by the hon. Gentleman.
The argument which we put forward, briefly, is that if there were a reorganisation before the first report was received, it would make a mockery of the whole procedure. The first report, in particular, obviously will be of great importance in this context. To do that would be to make a complete mockery of the first report if substantial alterations in the organisation—all those words being important—were made before the report was received.
It is even more important because, later in the Order Paper, the Minister himself has tabled Amendments to bring that first report and others before the House. What is the purpose of bringing that report before the House if action has already been taken on the very matters with which the report deals? The strengthening of Clause 4, for which we owe so much to my hon. Friend the Member for Yeovil, would be of no point if substantial changes had been made already.
What are the possible objections which one can imagine the Parliamentary Secretary raising? I suppose that he could say that it would be intolerable that comparatively small matters should not be dealt with until the first report was received. I hope that I have dealt with that possible objection by pointing out that only substantial alterations are involved. That is the reason for the drafting of the Clause as it is.
I suppose that he might say that he cannot deal with comparatively detailed matters of shareholdings, and so on. That is dealt with, because the new Clause is concerned only with alterations in the organisation of the activities.
I suppose that he might say that it is intolerable for him to be bound hand and foot and that he must be given some latitude to make a judgment. The answer to that is that he can. Under the Clause, they cannot act without the consent of the Minister. In other words, the Minister is in a position to give his consent to such a substantial alteration even though the report has not been received.
I find it difficult to see a more reasonable Clause and one which flows more

obviously and logically from the short discussion which we had on Clause 4 at an ungodly hour in the morning when the Parliamentary Secretary was lucky not to be in his present office, because he would have been worn down, as his predecessor was. It flows quite logically from the undertakings given by the Minister on that occasion. For that reason, in a spirit of compromise and good will, I hope that the Parliamentary Secretary will feel free to accept it.

The Parliamentary Secretary to the Ministry of Power (Mr. Reginald Freeson): It is intended that the general reorganisation of the industry after nationalisation should be preceded by a report, required under Clause 4. In fact, excellent progress is now being made by the Organising Committee in the preparation of such a report. It is hoped and expected that it will be made to the Minister at an early date.
However, it is possible that the extended kind of consultations that might arise during the course of the preparation of such a report could cause unexpected delay which, as time went on, might result in the need for substantial changes in the industry, as has been referred to by the hon. Member for Wokingham (Mr. van Straubenzee). Therefore, there is the possibility that the kind of situation which he has sought to meet in the Clause will arise. It is possible that the consultations with trade unions and with the many other interests, including the managements of the nationalised companies, would take longer than we envisaged at present. It is possible that the completion of the first report will be unexpectedly delayed as a result. It is because of this that under Clause 4 there is a requirement that the report be submitted within a year of vesting date, and the Clause gives the Minister power to extend this period if necessary.
If, for some reason which we cannot foresee, the first report and the general reorganisation of the industry were delayed in that way, it might be necessary to undertake a substantial alteration in the organisation of the industry on an interim basis.

Mr. van Straubenzee: The hon. Gentleman said that the wording which I had used "sought to close the gap", as though there were something technically


wrong with it. This may be so. If it is I hope that he will make it clear, because it seems that the proposed wording meets the situation which the hon. Gentleman has now outlined and which we, too, had thought of.

Mr. Freeson: I shall describe as I proceed, and it will not take very long, our reaction to the Clause. In the meantime, I must apologise if from time to time my wording is a little loose in a technical sense. I am not speaking as a drafter of Clauses.

Mr. A. G. F. Hall-Davis: I did not take part in the Committee debates, but I have not quite followed what the right hon. Gentleman said. Does he mean that when the report is made there will be consultations and long discussions before it is published? I imagined that the report would be published and then the discussions would take place. I got the impression that there would be delay while the discussions took place before the report was laid before the House.

Mr. Freeson: That might arise, but we do not expect it to. It could arise during the preparation of the report. During the preparation of the report there are bound to be ideas, schemes, and details to be worked out about the future reorganisation of the industry. This will involve consultations, during which queries might arise which could lead to extended discussions. I am not describing what is happening. I am not making a forecast of what we think will happen. I am simply stating what might happen. As I said at the beginning, excellent progress is being made, and we expect the report to be made fairly promptly, as required by the Bill.
The Corporation can, in practice, be expected and relied on to act in a way which will not prejudice the decisions of the Minister and the views and decisions of Parliament on the first report which is required under Clause 4. Indeed, we can expect the Corporation to consult the Minister before making any substantial changes in organisation. The Corporation will no doubt ensure that the publicly-owned companies do the same.
There are, however, advantages in formalising the matter, as is sought in the new Clause, and in imposing on the

Corporation a statutory requirement to obtain the Minister's consent for the issue or reissue of which the Minister would be answerable to Parliament in the case of any substantial reorganisation which might arise before there were any general reorganisation acceptable by way of the report.
The proposed Clause is, therefore, acceptable in principle, but the drafting is capable of some improvement, and some detailed changes are desirable. I hope that the hon. Gentleman will be happy about this. On this basis the Government will, in another place, introduce provisions to give effect to the intention of the Clause, and I am sure that we can be united in accepting this as a happy situation.

Mr. van Straubenzee: For once I am almost speechless, and the hon. Gentleman knows that that is rather rare for me. I am very much obliged to the hon. Gentleman. I am very pleased with him at the moment, and on that basis I beg to ask leave to withdraw the new Clause.

Motion and Clause, by leave, withdrawn.

New Clause 13.—(DUTY OF CORPORATION RELATING TO NAMES AND TRADEMARKS OF PUBLICLY-OWNED COMPANIES.)

It shall be the duty of the Corporation, in formulating any recommendations to the Minister relating to the activities that have fallen to be carried on under their ultimate control whether by way of conclusions reported to the Minister under Section 4 of this Act or otherwise and in carrying on those activities, to have regard to the advantages of preserving the good will attached to the names and trademarks of the companies specified in Schedule 1 to this Act and of their subsidiaries.—[Mr. J. H. Osborn.]

Brought up, and read the First time.

9.0 p.m.

Mr. J. H. Osborn: I beg to move, That the Clause be read a Second time.
I am greatly encouraged by the change of heart of the Government, and because of that I shall endeavour to be brief. Perhaps that will encourage the Minister to be generous. Although the Clause may not mean very much to us it is vital to those who have charge of the destiny of the steel industry when it is nationalised. The Minister has implied that I


might have a bias towards the private sector because of my interest in it. I hope that he will have realised by now—especially from my comments last night—that I am anxious that the Corporation should be a success and that it should take whatever decisions are necessary to ensure a healthy, successful and prosperous industry.
I also assure the Minister that any member of the private sector who will be competing against the public sector will hope that the Minister will accept the Clause or the sentiments behind it, because if the Corporation were too rapidly to abandon trade marks and names which have become well-established, the customers of the Corporation, whether at home or overseas, would become restless and look elsewhere. It would be a disaster if, within a few weeks of vesting date, we found that all the trade names were amalgamated under specifications starting with National Steel Corporation Specification No. 1 and that if a person wanted some bonded or coated steel he had to ask for N.S.C.S. No. 503. If that system were put into practice it would mean that we had completely failed to sense the demands of customers, and it would absolutely wreck not only part of the home trade, but certainly the export trade of this valuable industry.
The Benson Report refers on pages 28 and 29 to the export trade and it is estimated that by the mid-1970s the gross exports will be 5·4 million ingot tons and that net exports will be 4·2 million ingot tons. These estimates may have to be revised, but unless the Corporation sells with delicacy those forecasts will never be achieved.
It is worth considering how we sell steel, and what methods are applied. There may be a difference between selling bulk steels and special steels such as alloy, tool, and heat resisting steels, many of which are made by the private sector, but I have emphasised before, and I do so again, that a technical salesman must find out what the customer wants. The customer will have the specification. He wants to know what the heat treatment will be, or what kind of finish the product will have. When the customer knows what he wants he usually settles on a brandname that gives it to him

and thereafter he finds that he can have consistency in his machine shop or engineering shop.
One may ask how a customer identifies his requirements. There are many national and international specifications which may be used. I always keep in my diary a list of specifications used by the company with which I am associated, but correlated to the specifications of EN, Aircraft D.T.D., British Standards, and S.A.E., and sometimes the company's specification is related to national or international standards.
I do not want to digress too far, but the customer—either the engineer or the technician—will usually refer to an international specification when defining what he wants and tell the supplier or the steel manufacturer, but the steel manufacturer also has specifications of his own relating to various well-known trade marks. I have a list here of some of the names. There is Stelvetite, Dragonite, Silverfox and Fortiweld—all names well known by customers. I suggest that the importance of goodwill cannot be measured or quantified. Over the years, companies have made reputations for specialities like steel erecting, fencing, coated steel sheets, and steel work. All this may be kept, or lost within one vast organisation, unless the principle of the Clause is preserved in practice, whether it is accepted in the Bill or not.
I suggest that the Minister's interests must rest with this principle and I hope that the generosity which he showed before will be repeated—

Mr. Marsh: indicated dissent.

Mr. Osborn: I see the Minister shaking his head, but I hope that he will justify that view. Unless he accepts the sentiments behind the new Clause, the Corporation will have difficulty in selling at home, but more particularly overseas. This is an important new Clause and I hope that the Minister will change his mind and accept it.

Mr. Freeson: I accept the hon. Member's sentiments. We have a great deal of sympathy with the object of the new Clause and recognise that considerable commercial goodwill is attached to the names of the present companies. It is not just a historic goodwill but is associated with the quality of the product and related


to certain company names. There is no doubt that this would be as important an asset after nationalisation as before. We recognise also that, as a result of the associations with names over many years, a considerable loyalty to particular companies and groups has grown up.
These are particularly powerful considerations, which is why I begun by saying that we accept the sentiments expressed. They will no doubt influence the Corporation in its conduct of affairs and will be borne very much in mind by it when deciding how the public sector is to be organised. However, we cannot accept that this kind of provision should be written into a Bill. It does not require statutory expression. There might be situations in which it would be unfortunate to have such a requirement in the Bill, in view of the wide options which must be maintained in the Organising Committee to decide how it recommends future organisation of the industry.
Recommendations on the new framework might cut across the legislative insistence on retaining certain names. One must balance the two things fairly equally and leave it open for the Organising Committee. We are certain that the Corporation will have great regard to the considerations involved. However, the new Clause, if accepted, would merely be a declaration. It could not be particularly effective in organisation.
They are not the only considerations. I have indicated that there are others—those of loyalty and commercial goodwill associated with quality. Matters of organisation are ahead of us. The industry is to undergo major changes in this respect and it is well known that various concerns in the industry are already organised in different ways. They may be restructured according to the future grouping of the industry and it would be difficult to insist, by law, in these circumstances on the retention of names of particular concerns which were restructured to fit in with the recommendations of the Organising Committee.
Although we accept, in association with this idea, the need to maintain the vitality of what one would rightly describe as subordinate units of the industry, we must leave it open to central advisory authority, the Organising Committee, to make structural recommendations, which

will be decided upon, and upon which the Corporation will go about organising the industry. It is widely agreed—this has been referred to time and time again during the past two days, and I have no doubt it was referred to time and time again in Committee—that the nationalised steel industry will have to be reorganised into a smaller number of large groups. There may be differences as to the precise number, but this will undoubtedly be the future of the industry.
As I have said, some of these groupings are likely to cut across the existing pattern of organisation with which names of particular companies are associated.
I do not propose to deal with what might come out of the report which the Organising Committee will put to the Minister, and consequently to Parliament, but this is undoubtedly a consideration which we shall have to bear in mind. It may be that in the future, when the reputation of the National Steel Corporation is established, the Corporation will wish to trade under its own name. It is true that there is nothing in the Amendment which would prevent this, but there seems to be little point in inserting into the Bill a provision which may become less and less appropriate as circumstances change in the future history of the industry.
For these reasons, which I hope I have put fairly, I hope that the hon. Member will not press the point he has made.

Mr. Barber: This is for me a very sad moment because, after all the strictures which I heaped upon the hon. Gentleman the Parliamentary Secretary in a previous speech, listening to him winding up the discussion on this Clause, it was my intention to make a nice conciliatory speech, a few happy observations, and to congratulate him. But, alas, I cannot do so. I will say in his favour that he has dealt with the points raised by my hon. Friend the Member for Sheffield, Hallam (Mr. J. H. Osborn) in moving this new Clause, but the arguments which he adduced do not carry conviction. He said, on the one hand, that the new Clause would be completely ineffective, and then he said that it would be insistence by law. He cannot have it both ways. The truth is that there would be, to use his phrase, no insistence by law if the Clause were to be carried.
The Clause would lay upon the Corporation a duty in making recommendations to the Minister merely to have regard to the advantages of preserving the goodwill attached to the names and trademarks of the companies. That is not asking for a great deal. The Minister and the Corporation, at the end of the day, can make their decision, and they are fettered only to the extent that they must have regard to those advantages,

which are accepted by the Parliamentary Secretary on behalf of the Government.

I found his reply singularly unconvincing, but it is quite obvious that we shall not make any progress by pursuing the matter further. Therefore, I ask my right hon. and hon. Friends to support my hon. Friend by voting in the Lobby.

Question put, That the Clause be read a Second time:—

The House divided: Ayes. 228, Noes 301.

Division No. 238.]
AYES
[9.14 p.m.


Alison, Michael (Barkston Ash)
Forrest, George
Legge-Bourke, Sir Harry


Allason, James (Hemel Hempstead)
Fortescue, Tim
Lewis, Kenneth (Rutland)


Astor, John
Foster, Sir John
Lloyd, Ian (P'tsm'th, Langstone)


Atkins, Humphrey (M't'n &amp; M'd'n)
Fraser, Rt. Hn. Hugh (St'fford &amp; Stone)
Lloyd, Rt. Hn. Selwyn (Wirral)


Awdry, Daniel
Galbraith, Hn. T. G.
Longden, Gilbert


Baker, W. H. K.
Gibson-Watt, David
Loveys, W. H.


Balniel, Lord
Giles, Rear-Adm. Morgan
McAdden, Sir Stephen


Barber, Bt. Hn. Anthony
Gilmour, Ian (Norfolk, C.)
MacArthur, Ian


Batsford, Brian
Gilmour, Sir John (Fife, E.)
Maclean, Sir Fitzroy


Beamish, Col. Sir Tufton
Glover, Sir Douglas
Macleod, Rt. Hn. Iain


Bell, Ronald
Glyn, Sir Richard
Macmillan, Maurice (Farnham)


Berry, Hn. Anthony
Godber, Rt. Hn. J. B.
Maddan, Martin


Biffen, John
Goodhart, Philip
Maginnis, John E.


Biggs-Davison, John
Goodhew, Victor
Marples, Rt. Hn. Ernest


Black, Sir Cyril
Grant, Anthony
Marten, Neil


Blaker, Peter
Grant-Ferris, R.
Maude, Angus


Body, Richard
Gresham Cooke, R.
Maudling, Rt. Hn. Reginald


Bossom, Sir Clive
Grieve, Percy
Mawby, Ray


Boyd-Carpenter, Rt Hn. John
Griffiths, Eldon (Bury St. Edmunds)
Maxwell-Hyslop, R. J.


Boyle, Rt. Hn. Sir Edward
Gurden, Harold
Mills, Peter (Torrington)


Braine, Bernard
Hall, John (Wycombe)
Mills, Stratton (Belfast, N.)


Brinton, Sir Tatton
Hall-Davis, A. G. F.
Miscampbell, Norman


Brown, Sir Edward (Bath)
Hamilton, Marquess of (Fermanagh)
Mitchell, David (Basingstoke)


Bruce-Gardyne, J.
Hamilton, Michael (Salisbury)
Monro, Hector


Bryan, Paul
Harris, Reader (Heston)
More, Jasper


Buchanan-Smith, Alick (Angus, N&amp;M)
Harrison, Brian (Maldon)
Morgan, Geraint (Denbigh)


Buck, Antony (Colchester)
Harrison, Col. Sir Harwood (Eye)
Morrison, Charles (Devizes)


Bullus, Sir Eric
Harvey, Sir Arthur Vere
Mott-Radclyffe, Sir Charles


Burden, F. A.
Harvie Anderson, Miss
Munro-Lucas-Tooth, Sir Hugh


Campbell, Gordon
Hastings, Stephen
Murton, Oscar


Carlisle, Mark
Hawkins, Paul
Neave, Airey


Cary, Sir Robert
Hay, John
Nicholls, Sir Harmar


Channon, H. P. G.
Heath, Rt. Hn. Edward
Nott, John


Chichester-Clark, R.
Heseltine, Michael
Onslow, Cranley


Clark, Henry
Higgins, Terence L.
Orr, Capt. L. P. S.


Clegg, Walter
Hill, J. E. B.
Orr-Ewing, Sir Ian


Cooke, Robert
Hirst, Geoffrey
Osborn, John (Hallam)


Cooper-Key, Sir Neill
Hobson, Rt. Hn. Sir John
Osborne, Sir Cyril (Louth)


Costain, A. P.
Hogg, Rt. Hn. Quintin
Page, Graham (Crosby)


Craddock, Sir Beresford (Spelthorne)
Holland, Philip
Page, John (Harrow, W.)


Crawley, Aldan
Hooson, Emlyn
Pardoe, John


Crosthwaite-Eyre, Sir Oliver
Hordern, Peter
Pearson, Sir Frank (Clitheroe)


Crouch, David
Hornby, Richard
Peel, John


Crowder, F. P.
Howell, David (Guildford)
Percival, Ian


Cunningham, Sir Knox
Hunt, John
Peyton, John


Currie, G. B. H.
Hutchison, Michael Clark
Pike, Miss Mervyn


Dalkeith, Earl of
Iremonger, T. L.
Pink, R. Bonner


Dance, James
Irvine, Bryant Godman (Rye)
Pounder, Rafton


Davidson, James(Aberdeenshire, W.)
Jenkin, Patrick (Woodford)
Powell, Rt. Hn. J. Enoch


Dean, Paul (Somerset, N.)
Jennings, J. C. (Burton)
Price, David (Eastleigh)


Deedes, Rt. Hn. W. F. (Ashford)
Johnson Smith, G. (E. Grinstead)
Prior, J. M. L.


Digby, Simon Wingfield
Jones, Arthur (Northants, S.)
Quennell, Miss J. M.


Dodds-Parker, Douglas
Jopling, Michael
Ramsden, Rt. Hn. James


Doughty, Charles
Joseph, Rt. Hn. Sir Keith
Rawlinson, Rt. Hn. Sir Peter


Douglas-Home, Rt. Hn. Sir Alec
Kershaw, Anthony
Rees-Davies, W. Ft.


Drayson, C. B.
Kimball, Marcus
Renton, Rt. Hn. Sir David


du Cann, Rt. Hn. Edward
King, Evelyn (Dorset, S.)
Ridley, Hn. Nicholas


Eden, Sir John
Kirk, Peter
Ridsdale, Julian


Elliot, Capt. Walter (Carshalton)
Kitson, Timothy
Roots, William


Elliott, R.W.(N'c'tle-upon-Tyne, N.)
Knight, Mrs. Jill
Rossi, Hugh (Hornsey)


Farr, John
Lambton, Viscount
Royle, Anthony


Fisher, Nigel
Lancaster, Col. C. G.
Russell, Sir Ronald


Fletcher-Cooke, Charles
Langford-Holt, sir John
St. John-Stevas, Norman




Scott, Nicholas
Thatcher, Mrs. Margaret
wells, John (Maidstone)


Sharples, Richard
Tilney, John
Whitelaw, Rt. Hn. William


Shaw, Michael (Sc'b'gh &amp; Whitby)
Turton, Rt. Hn. R. H.
Wills, Sir Gerald (Bridgwater)


Sinclair, Sir George
van Straubenzee, W. R.
Wilson, Geoffrey (Truro)


Smith, John
Vaughan-Morgan, Rt. Hn. Sir John
Winstanley, Dr. M. P.


Stainton, Keith
Vickers, Dame Joan
Wolrige-Gordon, Patrick


Steel, David (Roxburgh)
Wainwright, Richard (Colne Valley)
Wood, Rt. Hn. Richard


Stodart, Anthony
Walker, Peter (Worcester)
Woodnutt, Mark


Summers, Sir Spencer
Walker-Smith, Rt. Hn. Sir Derek
Worsley, Marcus


Taylor, Sir Charles (Eastbourne)
Wall, Patrick
Wylie, N. R.


Taylor, Edward M.(G'gow, Cathcart)
Walters, Dennis
Younger, Hn. George


Taylor, Frank (Moss Side)
Ward, Dame Irene



Teeling, Sir William
Weatherill, Bernard
TELLERS FOR THE AYES:


Temple, John M.
Webster, David
Mr. Pym and Mr. Eyre.




NOES


Ahse, Leo
Dewar, Donald
Hunter, Adam


Albu, Austen
Diamond, Rt. Hn. John
Irvine, A. J. (Edge Hill)


Allaun, Frank (Salford, E.)
Dickens, James
Jackson, Peter M. (High Peak)


Alldritt, Walter
Dobson, Ray
Jay, Rt. Hn. Douglas


Allen, Scholefield
Doig, Peter
Jeger, George (Goole)


Anderson, Donald
Driberg, Tom
Jenkins, Hugh (Putney)


Archer, Peter
Dunn, James A.
Johnson, Carol (Lewisham, S.)


Armstrong, Ernest
Dunnett, Jack
Johnson, James (K'ston-on-Hull, W


Atkins, Ronald (Preston, N.)
Dunwoody, Mrs. Gwyneth (Exeter)
Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)


Atkinson, Norman (Tottenham)
Dunwoody, Dr. John (F'th &amp; C'b'e)
Jones, J. Idwal (Wrexham)


Bacon, Rt. Hn. Alice
Eadie, Alex
Judd, Frank


Bagier, Cordon A. T.
Edelman, Maurice
Kelley, Richard


Barnett, Joel
Edwards, Rt. Hn. Ness (Caerphilly)
Kenyon, Clifford


Beaney, Alan
Edwards, Robert (Bilston)
Kerr, Dr. David (W'worth, Central)


Bence, Cyril
Edwards, William (Merioneth)
Lawson, George


Benn, Rt. Hn. Anthony Wedgwood
Ellis, John
Leadbitter, Ted


Bennett, James (G'gow, Bridgeton)
English, Michael
Ledger, Ron


Bidwell, Sydney
Ennals, David
Lee, Rt. Hn. Frederick (Newton)


Binns, John
Ensor, David
Lee, John (Reading)


Bishop, E. S.
Evans, Albert (Islington, S.W.)
Lestor, Miss Joan


Blackburn, F.
Evans, loan L. (Birm'h'm, Yardley)
Lever, Harold (Cheetham)


Blenkinsop, Arthur
Fernyhough, E
Lewis, Arthur (W. Ham, N.)


Boardman, H.
Fitch, Alan (Wigan)
Lewis, Ron (Carlisle)


Booth, Albert
Fletcher, Raymond (Ilkeston)
Lipton, Marcus


Boston, Terence
Fletcher, Ted (Darlington)
Lomas, Kenneth


Bottomley, Rt. Hn. Arthur
Foley, Maurice
Loughlin, Charles


Boyden, James
Foot, Sir Dingle (Ipswich)
Luard, Evan


Braddock, Mrs. E. M.
Foot, Michael (Ebbw Vale)
Lyon, Alexander W. (York)


Bradley, Tom
Ford, Ben
Lyons, Edward (Bradford, E.)


Bray, Dr. Jeremy
Forrester, John
Mabon, Dr. J. Dickson


Brooks, Edwin
Fowler, Gerry
McBride, Neil


Broughton, Dr. A. D. D.
Fraser, John (Norwood)
McCann, John


Brown, Rt. Hn. George (Belper)
Fraser, Rt. Hn. Tom (Hamilton)
MacColl, James


Brown, Hugh D. (G'gow, Provan)
Freeson, Reginald
MacDermot, Niall


Brown, Bob(N'c'tle-upon-Tyne, W.)
Galpern, Sir Myer
Macdonald, A. H.


Brown, R. W. (Shoreditch &amp; F'bury)
Gardner, Tony
McGuire, Michael


Buchan, Norman
Garrett, W. E.
McKay, Mrs. Margaret


Buchanan, Richard (G'gow, Sp'burn)
Ginsburg, David
Mackenzie, Gregor (Ruthergien)


Butler, Herbert (Hackney, C.)
Gordon Walker, Rt. Hn. P. C.
Mackie, John


Butler, Mrs. Joyce (Wood Green)
Gray, Dr. Hugh (Yarmouth)
Mackintosh, John P.


Callaghan, Rt. Hn. James
Greenwood, Rt. Hn. Anthony
Maclennan, Robert


Cant, R. B.
Gregory, Arnold
MacMillan, Malcolm (Western Isles)


Carmichael, Neil
Griffiths, Rt. Hn. James (Llanelly)
McMillan, Tom (Glasgow, C.)


Carter-Jones, Lewis
Gunter, Rt. Hn. R. J.
McNamara, J. Kevin


Chapman, Donald
Hale, Leslie (Oldham, W.)
MacPherson, Malcolm


Coe, Denis
Hamilton, James (Bothwell)
Mahon, Peter (Preston, S.)


Coleman, Donald
Hamling, William
Mahon, Simon (Bootle)


Concannon, J. D.
Hannan, William
Mallalieu, E. L. (Brigg)


Contan, Bernard
Harrison, Walter (Wakefield)
Mallalieu, J.P.W.(Huddersfield, E.)


Corbet, Mrs. Freda
Hart, Mrs. Judith
Manuel, Archie


Craddock, George (Bradford, S.)
Haseldine, Norman
Mapp, Charles


Crawshaw, Richard
Hattersley, Roy
Marquand, David


Cronin, John
Hazell, Bert
Marsh, Rt. Hn. Richard


Crosland, Rt. Hn. Anthony
Heffer, Eric S.
Mason, Roy


Crossman, Rt. Hn. Richard
Henig, Stanley
Mayhew, Christopher


Cullen, Mrs. Alice
Herbison, Rt. Hn. Margaret
Mellish, Robert


Dalyell, Tam
Hilton, W. S.
Mendelson, J. J.


Darling, Rt. Hn. George
Hobden, Dennis (Brighton, K'town)
Mikardo, Ian


Davidson, Arthur (Accrington)
Hooley, Frank
Millan, Bruce


Davies, Dr Ernest (Stretford)
Horner, John
Milne, Edward (Elyth)


Davies, G. Elfed (Rhondda, E.)
Houghton, Rt. Hn. Douglas
Mitchell, R. C. (S'th'pton, Test)


Davies, Harold (Leek)
Howarth, Harry (Wellingborough)
Molloy, William


Davies, Ifor (Gower)
Howarth, Robert (Bolton, E.)
Moonman, Eric


Davies, Robert (Cambridge)
Howie, W.
Morgan, Elystan (Cardiganshire)


Davies, S. 0. (Merthyr)
Hoy, James
Morris, Alfred (Wythenshawe)


Delargy, Hugh
Hughes, Rt. Hn. cledwyn (Anglesey)
Morris, Charles R. (Openshaw)


Dell, Edmund
Hughes, Hector (Aberdeen, N.)
Murray, Albert


Dempsey, James
Hughes, Roy (Newport)
Neal, Harold







Newens, Stan
Roberts, Gwilym (Bedfordshire, S.)
Tinn, James


Norwood, Christopher
Robertson, John (Paisley)
Tomney, Frank


Oakes, Gordon
Robinson, Rt. Hn. Kennet(St. P'c' as)
Tuck, Raphael


Oram, Albert E.
Robinson, W. O. J. (Walth'stow, E.)
Urwin, T. W.


Orbach, Maurice
Rodgers, William (Stockton)
Varley, Eric G.


Orme, Stanley
Roebuck, Roy
Wainwright, Edwin (Dearne Valley)


Oswald, Thomas
Rogers, George (Kensington, N.)
Walden, Brian (All Saints)


Owen, Dr. David (Plymouth, S'tn)
Rose, Paul
Walker, Harold (Doncaster)


Owen, Will (Morpeth)
Ross, Rt. Hn. William
Wallace, George


Palmer, Arthur
Rowland, Christopher (Meriden)
Watkins, David (Consett)


Panneli, Rt. Hn. Charles
Rowlands, E. (Cardiff, N.)
Watkins, Tudor (Brecon &amp; Radnor)


Park, Trevor
Ryan, John
Weitzman, David


Parker, John (Dagenham)
Shaw, Arnold (llford, S.)
Wellbeloved, James


Parkyn, Brian (Bedford)
Sheldon, Robert
Whitaker, Ben


Pavitt, Laurence
Shinwell, Rt. Hn. E.
White, Mrs. Eirene


Pearson, Arthur (Pontypridd)
Shore, Peter (Stepney)
Whitlock, William


Peart, Rt. Hn. Fred
Short, Rt. Hn. Edward(N'c'stle-u-Tyne)
Wigg, Rt. Hn. George


Pentland, Norman
Short, Mrs. Renée(W'hampton, N.E.)
Wilkins, W. A.


Perry, Ernest G. (Battersea, S.)
Silkin, Rt. Hn. John (Deptford)
Williams, Alan (Swansea, W.)


Perry, George H. (Nottingham, S.)
Silkin, Hn. S. C. (Dulwich)
Williams, Alan Lee (Hornchurch)


Prentice, Rt. Hn. R. E.
Silverman, Julius (Aston)
Williams, Clifford (Abertillery)


Price, Christopher (Perry Barr)
Silverman, Sydney (Nelson)
Williams, Mrs. Shirley (Hitchin)


Price, Thomas (Westhoughton)
Skeffington, Arthur
Williams, W. T. (Warrington)


Price, William (Rugby)
Slater, Joseph
Willis, George (Edinburgh, E.)


Probert, Arthur
Small, William
Wilson, Rt. Hn. Harold (Huyton)


Pursey, Cmdr. Harry
Snow, Julian
Wilson, William (Coventry, S.)


Randall, Harry
Spriggs, Leslie
Winnick, David


Rankin, John
Steele, Thomas (Dunbartonshire,W.)
Woodbum, Rt. Hn. A.


Redhead, Edward
Strauss, Rt. Hn. G. R.
Woof, Robert


Reynolds, G. W.
Taverne, Dick
Wyatt, Woodrow


Rhodes, Geoffrey
Thomas, George (Cardiff, W.)
Yates, Victor


Roberts, Albert (Normanton)
Thomson, Rt. Hn. George



Roberts, Goronwy (Caernarvon)
Thornton, Ernest
TELLERS FOR THE NOES




Mr. Harper and Mr. Grey.

Clause 1.—(THE NATIONAL STEEL CORPORATION.)

Mr. Alison: I beg to move Amendment No. 2, in page 1, line 11, at the end to insert:
Provided that the Minister may by order change the name of the Corporation.
I trust that the Minister or the Parliamentary Secretary, fortified by the appreciable majority which they scored on the last Division, and mollified by the rapid progress that we are now making, will return to the earlier disposition which they showed and accept this reasonable and flexible Amendment which, I believe, may stand them in very good stead later on because it gives them the possibility at a later stage in the development of the activities of the Corporation of changing its name.
There are some genuinely unsatisfactory aspects of the present title with which, for understandable reasons, the Minister has had to saddle the new entity which the Organising Committee will bring into existence. One of the most unsatisfactory aspects is the somewhat narrow but genuine point that there already is in existence a National Steel Corporation, one in the United States, a substantial private steel company producing on its own equivalent to a quarter of the present output of the British steel industry.
When we touched earlier on the subject of the difficulties which might arise over patents as between the British National Steel Corporation and the National Steel Corporation in the United States, the Minister on the whole tended to wave aside our arguments, saying that he had gone into the facts and figures and only five patents were registered in the United Kingdom by the American National Steel Corporation. The implication of what he argued in Committee was that our Corporation and the one already in the United States are operating in two quite different spheres.
This reminded me of the days when the C.B.I. used to be called the F.B.I. When they looked up F.B.I. in the international commercial directories the Americans were always very surprised to find that it stood for the Federation of British Industries. This is because the F.B.I. is an American national organisation, and it is probably just as well that the American F.B.I. did not overlap. The truth was that it was reasonable that an international commercial directory should register the F.B.I. as the Federation of British Industries because the American F.B.I. was a national body and the British F.B.I. operated throughout the world.
But we are now reaching a situation in the way in which steel markets throughout the world are developing in which it


is clear that an increasing volume of steel, in the conditions of over-supply and over-capacity, will be flowing into the international markets. I believe that there genuinely is a growing possibility, particularly with the export trade and the cutback in demand for steel products in the domestic markets, for the National Steel Corporation of the United States and the National Steel Corporation of the United Kingdom to tangle in the international sphere. I believe that the Government should take cognisance of this because it is a real possibility, and on this narrow ground alone we want the Minister to give himself power to change the name if the need arises.
There is a wider aspect. We must now build into this British steel enterprise and the whole British steel industry an international flavour. It is self-evident that if we cannot earn our keep in steel in international trade—although we already export about a sixth of our output—there is no future for British steel. It is significant that the Government or public corporations which operate to some extent overseas—for example. B.E.A., although we know that its most popular route is from London to Scotland—deliberately include in their title "British". We believe that the Corporation should explicitly carry the title "British".
9.30 p.m.
In Committee, the Minister argued that there are already in existence, as subsidiaries of the Federation, a body calling itself the British Steel Corporation and another calling itself the British Iron and Steel Corporation. That objection is no longer valid. On Second Reading, the Minister said:
It is clearly essential that the nationalised companies should withdraw as quickly as possible, on fair terms, from the B.I.S.F. and that the central trading services operated by the Federation should be transferred to the Corporation."—[OFFICIAL REPORT, 25th July, 1966; Vol. 732, c. 1234.]
This clearly shows that the subsidiaries of the Federation which carry the title "British" are to be taken over by the Corporation to become its subsidiaries. What an anomalous position it will be if the National Steel Corporation has two subsidiaries bearing the title "British" while, as the parent company, it cannot have the title but must retain the name

"National", which implies that "British" means a smaller grouping than "National", because "National" takes direct account of Northern Ireland.
We want to give the Minister flexibility without commitment now to a definite title. We want to give him the opportunity to be able to take on the title "British" for the Corporation, which will be a great national undertaking. This would facilitate its operations abroad. The right hon. Gentleman has hinted that for some time the overseas trading of the undertaking will be carried on by the old companies but he used that rather mischievous, ambiguous and shadowy word "initially", seeming to imply that the Corporation would eventually lend its title to the operations of British steel overseas.
Let him now give himself power without commitment to change the name. Any honest man proposing to go into the future would want to be in a position to change someone's name if he was a bachelor. Let us give the Minister power to change the name of the Corporation in the future, launching it into international trading with the full title of Britain. We hope that he will see his way to accepting this modest, constructive and reasonable Amendment.

Mr. Gresham Cooke: This is typical of the facility of the Labour Party for calling something by the wrong name. When we have unemployment, it calls it redeployment. When we have inflation, it calls it reflation. This Corporation is being set up to control the iron and steel industry and the Government call it the National Steel Corporation, disregarding the fact that the industry not only produces 27 million tons of steel, but 17 million tons of iron. The obvious name is the British Iron and Steel Corporation.
To call it the National Steel Corporation is the Labour Party falling into the old trap. It can never call a spade a spade, but must always choose a flowery title, usually to disguise what the thing is or is supposed to be.

Mr. Freeson: Unlike the hon. Member for Barkston Ash (Mr. Alison), the Government do not believe that the fact that the Corporation will have the same name as the American company which he mentioned need cause any difficulty.


In this country there will be no complications and no difficulty about registration, as the name "National Steel Corporation" will be conferred on the Corporation by an Act of Parliament. The American company has no branches in this country. It has some patents, but the register of patents clearly identifies it as a Corporation organised in the State of Delaware in the United States, so there is no difficulty, Finally, the choice of name for the Corporation is entirely within the purview of the Parliament of the United Kingdom. In overseas countries where difficulties could arise it would be open to the Corporation to register subsidiary companies under appropriate names which would avoid any confusion in the countries concerned, America or anywhere else.
However, as my right hon. Friend said in Committee, the Government have considered calling the Corporation the "British Steel Corporation" or the "British Iron and Steel Corporation", which would be more happily received by the hon. Member for Twickenham (Mr. Gresham Cooke). But at present those names are pre-empted by the subsidiaries of the Federation which already exists.
As I understand it, the difficulty could be readily overcome when the Corporation is set up and there is a transfer of the central trading companies of the Federation to the Corporation. It would certainly be an advantage to the Corporation, if it were thought desirable, to adopt one or other of these names without having to have another Act of Parliament, and we will certainly want to take into account the advantage of having the word "British" in the title, one of the points made by both hon. Members.
The incorporation of a provision in the Bill which would allow the Minister to change the Corporation's name if it proved, contrary to expectation, that having the same name as the American company caused difficulties would also allow for speedy action without further Parliamentary action. The Amendment would certainly allow this to be done by Order and therefore, hon. Members will be happy to know, once again we accept the Amendment in principle.
There are certain drafting defects as the Amendment stands. Difficulty about

language is not confined to one or other parties in the House or anywhere else.

Mr. Alison: Is the difficulty about the wording connected with word "Order"? Is it a question of whether it would be an affirmative or negative procedure by which the change would be made?

Mr. Freeson: As I have said in a previous debate this evening, I do not speak here as drafting lawyer or officer, and I cannot say what the difficulties are. We must accept advice on these things and our advice is that there are drafting defects. If the hon. Gentleman will withdraw the Amendment, we will undertake to introduce an appropriate Amendment in another place.

Mr. Alison: I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. John Peyton: I beg to move Amendment No. 3, in page 1, line 12, to leave out 'having perpetual succession' and to insert:
'the powers and duties of which as conferred and imposed by this Act shall lapse after a period of ten years unless then renewed by Parliament'.
I must admit that when, seeking some relief during the Recess, I returned to the Bill, I found my eye lighting almost for the first time on the words "perpetual succession". Reflecting, as I have for a good deal of time over the last few months, on the subject of the nationalisation of steel, I found these words at the very beginning of the Bill so odious that I thought that it would not be a bad idea if we left them out and substituted for them the modest and mild Amendment which I have moved and which would allow a review by Parliament of the successes or failures of the Corporation after a period of 10 years.
I do not believe that this is at all unreasonable. It might commend itself to the House, and I am confident that it will have the support of my hon. Friends. The Minister and the Government have had a great deal of time in which to prepare their plans for the future of the steel industry. Some of us suspect that those plans have not yet reached the stage of readiness which one might have expected after the long years of threat which hon. and right hon. Gentlemen opposite have


seen fit to hold over the head of the steel industry.
I suggest that now, as they are confident that they are doing the right thing, the best thing by the industry and the country, and that they are not pursuing merely doctrinaire aims in taking over this industry, it would be a very reasonable thing, in 10 years' time, for there to be a judgment. At the moment, the right hon. Gentleman will say that we have strong feelings against nationalisation, that we do not think that it is right but that he does.
I am not altogether certain that, from time to time, in his heart of hearts, the right hon. Gentleman has felt this to be wrong. It is his job to say that this is not so, but I feel that the Minister ranks among those in the Socialist Party—I do not, of course, refer to the garrulous and cackling Left-wing, but to the more respectable section of the Socialist Party, and there is such a section—who feel that this is really a quite unnecessary experiment, which will not get anyone anywhere. All that I am suggesting in this very modest Amendment is that after 10 years the matter should be put on trial.
I must admit that there is a certain pessimism lurking in this Amendment, which I wish to discount immediately. It is only inserted there upon the unlikely premise that there will be a Socialist Government for another 10 years. I feel very confident that when my right hon. Friend the Member for Altrincham and Sale (Mr. Barber) has a large responsibility for this country's affairs, which his abilities make almost essential, one of the first things that he will wish to do is to disembarrass the State of the steel industry and return it to private enterprise and a state of competition, initiative and all the rest. We look forward to that day, but just in case the worst occurs, and we should have a Socialist Government in another 10 years, it would be a very becoming exercise in modesty for the right hon. Gentleman or his successor to be called to account at that Box, and to renew the mandate which this Bill is now giving him to take over this industry.

Sir D. Glover: This is the first time for many years when I cannot support my hon. Friend the Member for Yeovil

(Mr. Peyton). He has forgotten that no Parliament can bind another and that this Amendment is, therefore, irrelevant. Long before the 10 years are up another Parliament will have another opportunity of rescinding this business.

9.45 p.m.

Mr. Barber: It is quite clear that my own party is divided fifty-fifty on this particular issue and it is right that I should express an opinion. It is a personal opinion, and I do not wish to fall out with either half of the Conservative Party.
I should not go into the Lobby with my hon. Friend the Member for Yeovil (Mr. Peyton) for the simple reason that, as he said, this Amendment is proposed on the unlikely premise that we have a Socialist Government for the next 10 years. To me, that is such a remote possibility that I do not think that it is worth wasting Parliament's time to divide upon it.

Mr. Freeson: I trust, also, that the possibility of denationalisation is so remote as not to be worth considering.
Hon. Members will not expect me to receive this Amendment with the satisfaction with which I received one or two previous Amendments. In fact, it is a nonsense, as I believe the hon. Member for Yeovil (Mr. Peyton) realises. It would insert in the Bill a provision which would effectively change the whole character of the Bill into a subsection making purely formal provisions for the Corporation. The absurdity is seen clearly when one realises how the Clause would read if the Amendment were inserted:
The Corporation shall be a body corporate the powers and duties of which as conferred and imposed by this Act shall lapse after a period of ten years unless renewed by Parliament having a common seal.
Apart from the drafting point, the Amendment is absurd on more general grounds. It would prolong the uncertainty which I think everybody accepts has been a curse on the industry for long enough and which it is important to end. It was for that reason as well as for others which have been ably pinpointed by the right hon. Member for Altrincham and Sale (Mr. Barber) today and yesterday in quoting from my election address that I referred to the remoteness of denationalisation.


It is important that that should be said, because one or two Members have hinted that this was in their minds. Very few Members on either side of the House and in the country would advocate a further measure of that kind.

Mr. Barber: I intervene only to urge the hon. Gentleman not to be unnecessarily provocative and to prolong the debate. I say this with great respect. We on these benches made our position on denationalisation absolutely clear on Second Reading. I do not want to have to go over the ground again. I hope that the hon. Gentleman will not refer to the matter again, otherwise he will prolong our proceedings.

Mr. Freeson: I must be allowed to say what I wish to say in my own way. The right hon. Gentleman has had a great deal of fun on this issue. One or two other Members have referred to the subject. I hope that the right hon. Gentleman will have the graciousness to allow me to refer to it as well. [HON. MEMBERS: "Oh."] Hon. Members should allow me to complete my remarks.
I have said that the Amendment is an absurdity, and I have given the reason for saying that. I do not believe that any hon. Member wishes to divide on the issue. I ask the House to reject the Amendment if the hon. Member for Yeovil will not agree to withdraw it.

Sir J. Eden: I do not think the Parliamentary Secretary took the Amendment seriously enough. He seemed to take exception to the advice given to him by my right hon. Friend the Member for Altrincham and Sale (Mr. Barber). Had he been a member of Standing Committee D, he would have learned very rapidly how wise he would be to heed what my right hon. Friend said to him. Unfortunately, we do not have the opportunity at this stage of going too far in encouraging him to listen more attentively to the words which my right hon. Friend may say to him at a later date.
My hon. Friend the Member for Yeovil (Mr. Peyton), who moved many Amendments throughout the Committee stage, which contributed greatly to the improvement of the Bill, has clearly given much thought to this Amendment. While I share with my right hon. Friend every

doubt as to the possibility of the maintenance in office of a Labour Government for such a long period as to necessitate the bringing into force of the Amendment, it would nevertheless be wise for the Government seriously to consider writing into the Bill every power which may save time later.
What is important in this context is that this would give them a chance to haw a second view of the matter. They cannot posibly get the whole structure and organisation right at first go, and I am therefore sure that my hon. Friend was correct in trying to write into the Bill some long-stop provision of this nature to give the Government an opportunity of a second look.
But I see the force of the speech made by my right hon. Friend and the contribution interjected by my hon. Friend the Member for Ormskirk (Sir D. Glover), and I am tempted not to encourage my hon. Friend the Member for Yeovil to insist on forcing the Amendment to a Division. However, having had the opportunity of listening to the Parliamentary Secretary's speech, I discount completely the matter of the speech, but what is worth voting against now and on every conceivable opportunity in the future is the hon. Gentleman's attitude.
It is precisely this arrogant, high-handed offensive approach which he is bringing to the conduct of the nation's affairs that I shall vote against on every conceivable occasion, and it is against this attitude that I ask my hon. Friend the Member for Yeovil to divide the House.

Mr. Peyton: May I have the leave of the House to make one or two comments?

Mr. Speaker: The hon. Member does not need that permission.

Mr. Peyton: I should like to make one or two comments. Yesterday was the first performance of the Parliamentary Secretary at the Box. Without being particularly impressed by what happened, we gave him forbearance. Today he delivered his opinion on the subject of absurdity. On that, I am bound to concede, he is an expert. It is a pity that the right hon. Gentleman the Paymaster-General came in. He never contributes anything positive—

Mr. Speaker: Order. The hon. Member must come to his Amendment.

Mr. Peyton: My comments on my Amendment were interrupted by the unusual intrusion of the Paymaster-General and I was tempted to comment on the fact. At this time the Minister of Power, who during these proceedings, if I may say so, has developed a habit of courtesy towards us which has not been uninfluential in our proceedings, left the Chamber for a moment or so, which allowed the Parliamentary Secretary the opportunity to get up and to reveal his inexperience to the full.
The hon. Member said that we were having fun. One thing I wish to make absolutely clear: if I could wreck this Bill, I would. The only reason why we did not intend to take the Amendment to a vote was that we knew perfectly well that at the right hon. Gentleman's beck and call, at the call of a bell, are hundreds of Members who will obediently come to vote for anything that their masters say. So we have decided that such an Amendment as this, which is plainly wrecking—I concede that—was probably not one worth voting on. It is not for me to decide. It is for my right hon. Friend, really. I would accept any advice he likes to give.

Mr. Michael Foot: The hon. Member may disagree with his right hon. Friend.

Mr. Peyton: No. My hon. Friend has co-operated with every person who sat behind him—so well, he now deserves our full support, and gets it. This is not the kind of thing which, I know, would be understood easily by the hon. Member for Ebbw Vale (Mr. Michael Foot). If he wishes to interrupt me I shall be very glad to give way to him, because of all people whose presence we missed on the Standing Committee he perhaps, and his hon. Friend—

Mr. Speaker: Order. We may, too, have missed his presence—in the Standing Committee—but that is not what we are discussing here, and the hon. Member must come to the Amendment.

Mr. Peyton: I was terribly provoked. Knowing as I do, Mr. Speaker, your great dislike of sedentary interruptions, I allowed myself that modest protest. I

am so sorry. I will endeavour, so long as I am not greatly provoked again, not to repeat my error.

Mr. Michael Foot: Oh.

Mr. Peyton: Your influence, Mr. Speaker, is communicating itself to the hon. Member for Ebbw Vale.
But to return to this Amendment and the Parliamentary Secretary's astonishing performance on it. He then went on to dismiss the whole thing with the suggestion that we had had our bit of fun. I should like once again to re-echo and affirm, as I have done frequently in the past months, what my hon. Friend the Member for Bournemouth, West (Sir J. Eden) said, and so just dismiss this. I can agree with what he has said. I would only add to it that the Parliamentary Secretary has given a very good example of the insolence of puppyhood, and I think it worth while, if my right hon. Friend agrees with this course, that we should vote against the Parliamentary Secretary, just to show him.

Mr. Barber: By leave of the House, I spoke to this Amendment with great brevity for two reasons, first, because the case had been adequately put with great clarity by my hon. Friend the Member for Yeovil (Mr. Peyton), and, secondly, because, as my hon. Friend has just said, he did not intend to take his Amendment to a Division; but the whole House has witnessed what has happened during the past 10 or 15 minutes. The right hon. Gentleman the Minister of Power, at the beginning of our deliberations in the Standing Committee, started, if I may say so, with much the same approach to Members of Parliament, but by Christmas time he had, I think, learned a thing or two.
The Parliamentary Secretary has brought this on himself, and I have not the slightest doubt, in view of his performance and of the things which he said, provocative in the extreme, that we should, in protest, divide the House.

Question put, That 'having perpetual succession' stand part of the Bill:—

The House divided: Ayes 305, Noes 216.

Division No. 239.]
AYES
[9.59 p.m.


Abse, Leo
Alldritt, Walter
Archer, Peter


Albu, Austen
Allen, Scholefield
Armstrong, Ernest


Allaun, Frank (Salford, E.)
Anderson, Donald
Atkins, Ronald (Preston, N.)




Atkinson, Norman (Tottenham)
Ford, Ben
MacPherson, Maicolm


Bacon, Rt. Hn. Alice
Forrester, John
Mahon, Peter (Preston, S.)


Bagier, Gordon A. T.
Fowler, Gerry
Mahon, Simon (Bootle)


Barnett, Joel
Fraser, John (Norwood)
Mallalieu, E. L. (Brigg)


Beaney, Alan
Fraser, Rt. Hn. Tom (Hamilton)
Mallalieu, J.P.W.(Huddersfield, E.)


Bence, Cyril
Freeson, Reginald
Manuel, Archie


Bennett, James (G'gow, Bridgeton)
Galpern, Sir Myer
Mapp, Charles


Bidwell, Sydney
Gardner, Tony
Marquand, David


Binns, John
Garrett, W. E.
Marsh, Rt. Hn. Richard


Bishop, E. S.
Ginsburg, David
Mason, Roy


Blackburn, F.
Gray, Dr. Hugh (Yarmouth)
Mayhew, Christopher


Blenkinsop, Arthur
Greenwood, Rt. Hn. Anthony
Mellish, Robert


Boardman, H.
Gregory, Arnold
Mendelson, J. J.


Booth, Albert
Grey, Charles (Durham)
Mikardo, Ian


Boston, Terence
Griffiths, Rt. Hn. James (Llanelly)
Millan, Bruce


Bottomley, Rt. Hn. Arthur
Grimond, Rt. Hn. J.
Milne, Edward (Blyth)


Boyden, James
Gunter, Rt. Hn. R. J.
Mitchell, R. C. (S'th'pton, Test)


Braddock, Mrs. E. M.
Hale, Leslie (Oldham, W.)
Molloy, William


Bradley, Tom
Hamilton, James (Bothwell)
Moonman, Eric


Bray, Dr. Jeremy
Hamling, William
Morgan, Elystan (Cardiganshire)


Brooks, Edwin
Hannan, William
Morris, Alfred (Wythenshawe)


Broughton, Dr. A. D. D.
Harper, Joseph
Morris, Charles R. (Openshaw)


Brown, Rt. Hn. George (Belper)
Harrison, Walter (Wakefield)
Morris, John (Aberavon)


Brown, Hugh D. (G'gow, Provan)
Hart, Mrs. Judith
Moyle, Roland


Brown, Bob(N'c'tle-upon-Tyne, W)
Haseldine, Norman
Murray, Albert


Brown, R. W. (Shoreditch &amp; F'bury)
Hattersley, Roy
Neal, Harold


Buchan, Norman
Hazeil, Bert
Newens, Stan


Buchanan, Richard (G'gow, Sp'burn)
Heffer, Eric S.
Norwood, Christopher


Butler, Herbert (Hackney, C.)
Henig, Stanley
Oakes, Gordon


Butler, Mrs. Joyce (Wood Green)
Herbison, Rt. Hn. Margaret
O'Malley, Brian


Callaghan, Rt. Hn. James
Hilton, W. S.
Oram, Albert E.


Cant, R. B.
Hobden, Dennis (Brighton, K'town)
Orbach, Maurice


Carmichael, Neil
Hooley, Frank
Orme, Stanley


Carter-Jones, Lewis
Hooson, Emlyn
Oswald, Thomas


Chapman, Donald
Horner, John
Owen, Dr. David (Plymouth, S'tn)


Coe, Denis
Houghton, Rt. Hn. Douglas
Owen, Will (Morpeth)


Coleman, Donald
Howarth, Harry (Wellingborough)
Palmer, Arthur


Concannon, J. D.
Howarth, Robert (Bolton, E.)
Pannnell, Rt. Hn. Charles


Conian, Bernard
Howie, W.
Pardoe, John


Corbet, Mrs. Freda
Hoy, James
Park, Trevor


Craddock, George (Bradford, S.)
Hughes, Rt. Hn. Cledwyn (Anglesey)
Parker, John (Dagenham)


Crawshaw, Richard
Hughes, Hector (Aberdeen, N.)
Parkyn, Brian (Bedford)


Cronin John
Hughes, Roy (Newport)
Pavitt, Laurence


Crosland, Rt. Hn. Anthony
Hunter, Adam
Pearson, Arthur (Pontypridd)


Crossman, Rt. Hn. Richard
Irvine, A. J. (Edge Hill)
Peart, Rt. Hn. Fred


Cullen, Mrs. Alice
Jackson, Peter M. (High Peak)
Perry, Ernest G. (Battersea, S.)


Dalyell, Tam
Jay, Rt. Hn. Douglas
Perry, George H. (Nottingham, S.)


Darling, Rt. Hn. George
Jeger, George (Goole)
Prentice, Rt. Hn. R. E.


Davidson, Arthur (Accrington)
Jenkins, Hugh (Putney)
Price, Christopher (Perry Barr)


Davidson,James(Aberdeenshire, W.)
Johnson, Carol (Lewisham, S.)
Price, Thomas (Westhoughton)


Davies, Dr. Ernest (Stretford)
Johnson, James (K'ston-on-Hull, W.)
Price, William (Rugby)


Davies, G. Elfed (Rhondda, E.)
Jones,Rt.Hn.Sir Elwyn(W.Ham,S.)
Probert, Arthur


Davies, Harold (Leek)
Jones, J. Idwal (Wrexham)
Pursey, Cmdr. Harry


Davies, Ifor (Gower)
Judd, Frank
Randall, Harry


Davies, Robert (Cambridge)
Kenyon, Clifford
Rankin, John


Davies, S. O. (Merthyr)
Kerr, Dr. David (W'worth, Central)
Redhead, Edward


Delargy, Hugh
Lawson, George
Reynolds, G. W.


Dell, Edmund
Leadbitter, Ted
Rhodes, Geoffrey


Dempsey, James
Ledger, Ron
Roberts, Albert (Normanton)


Dewar, Donald
Lee, Rt. Hn. Frederick (Newton)
Roberts, Goronwy (Caernarvon)


Diamond, Rt. Hn. John
Lee, John (Reading)
Roberts, Gwilym (Bedfordshire, S.)


Dickens, James
Lestor, Miss Joan
Robertson, John (Paisley)


Dobson, Ray
Lever, Harold (Cheetham)
Robinson, Rt. Hn. Kcnneth(St.P'c'as)


Doig, Peter
Lewis, Arthur (W. Ham, N.)
Robinson, W. O. J. (Waith'stow, E.)


Driberg, Tom
Lewis, Ron (Carlisle)
Rodgers, William (Stockton)


Dunn, James A.
Lipton, Marcus
Roebuck, Roy


Dunnett, Jack
Lomas, Kenneth
Rogers, George (Kensington, N.)


Dunwoody, Mrs. Gwyneth (Exeter)
Loughlin, Charles
Rose, Paul


Dunwoody, Dr. John (F'th &amp; C'b'e)
Luard, Evan
Ross, Rt. Hn. William


Eadie, Alex
Lubbock, Eric
Rowland, Christopher (Meriden)


Edelman, Maurice
Lyon, Alexander W. (York)
Rowlands, E. (Cardiff, N.)


Edwards, Robert (Bilston)
Lyons, Edward (Bradford, E.)
Ryan, John


Edwards, William (Merioneth)
Mabon, Dr. J. Dickson
Shaw, Arnold (llford, S.)


Ellis, John
McCann, John
Sheldon, Robert


English, Michael
MacColl, James
Shinwell, Rt. Hn. E.


Ennals, David
Macdonald, A. H.
Shore, Peter (Stepney)


Ensor, David
McGuire, Michael
Short, Rt. Hn. Edward(N'c'tle-u-Tyne)


Evans, Albert (Islington, S.W.)
McKay, Mrs. Margaret
Short, Mrs. Renée(W'hampton, N.E.)


Fernyhough, E.
Mackenzie, Gregor (Rutherglen)
Silkin, Rt. Hn. John (Deptford)


Fitch, Alan (Wigan)
Mackie, John
Silkin, Hn. S. C. (Dulwich)


Fletcher, Raymond (Ilkeston)
Mackintosh, John P.
Silverman, Julius (Aston)


Fletcher, Ted (Darlington)
Maclennan, Robert
Silverman, Sydney (Nelson)


Foley, Maurice
MacMillan, Malcolm (Western Isles)
Skeffington, Arthur


Foot, Sir Dingle (Ipswich)
McMillan, Tom (Glasgow, C.)
Small, William


Foot, Michael (Ebbw Vale)
McNamara, J. Kevin
Snow, Julian




Spriggs, Leslie
Wainwright, Richard (Colne Valley)
Williams, Clifford (Abertillery)


Steel, David (Roxburgh)
Walden, Brian (All Saints)
Williams, Mrs. Shirley (Hitchin)


Steele, Thomas (Dunbartonshire, W.)
Walker, Harold (Doncaster)
Williams, W. T. (Warrington)


Strauss, Rt. Hn. G. R.
Wallace, George
Willis, George (Edinburgh, E.)


Taverne, Dick
Watkins, David (Consett)
Wilson, Rt. Hn. Harold (Huyton)


Thomas, George (Cardiff, W.)
Watkins, Tudor (Brecon &amp; Radnor)
Wilson, William (Coventry, S.)


Thomson, Rt. Hn. George
Weitzman, David
Winnick, David


Thornton, Ernest
Wellbeloved, James
Winstanley Dr. M. P.


Thorpe, Jeremy
Whitaker, Ben
Woof, Robert


Tinn, James
White, Mrs. Eirene
Wyatt, Woodrow


Tomney, Frank
Whitlock, William
Yates, Victor


Tuck, Raphael
Wigg, Rt. Hn. George



Urwin, T. W.
Wilkins, W. A.
TELLERS FOR THE AYES:


Varley, Eric G.
Williams, Alan (Swansea, W.)
Mr. McBride and


Wainwright, Edwin (Dearne Valley)
Williams, Alan Lee (Hornchurch)
Mr. Ioan L. Evans.




NOES


Alison, Michael (Barkston Ash)
Galbraith, Hn. T. G.
Macmillan, Maurice (Farnham)


Allason, James (Hemel Hempstead)
Gibson-Watt, David
Maddan, Martin


Astor, John
Giles, Rear-Adm. Morgan
Maginnis, John E,


Atkins, Humphrey (M't'n &amp; M'd'n)
Gilmour, Ian (Norfolk, C.)
Marten, Neil


Awdry, Daniel
Gilmour, Sir John (Fife, E.)
Maude, Angus


Baker, W. H. K.
Glover, Sir Douglas
Maudling, Rt. Hn. Reginald


Balniel, Lord
Glyn, Sir Richard
Mawby, Ray


Barber, Rt. Hn. Anthony
Godber, Rt. Hn. J. B.
Maxwell-Hyslop, R. J.


Batsford, Brian
Goodhart, Philip
Mills, Peter (Torrington)


Beamish, Col. Sir Tufton
Goodhew, Victor
Mills, Stratton (Belfast, N.)


Bell, Ronald
Grant-Ferris, R.
Miscampbell, Norman


Berry, Hn. Anthony
Gresham Cooke, R.
Mitchell, David (Basingstoke)


Biffen, John
Grieve, Percy
Monro, Hector


Biggs-Davison, John
Griffiths, Eldon (Bury St. Edmunds)
More, Jasper


Black, Sir Cyril
Gurden, Harold
Morgan, Geraint (Denbigh)


Blaker, Peter
Hall, John (Wycombe)
Morrison, Charles (Devizes)


Body, Richard
Hall-Davis, A. G. F.
Mott-Radclyffe, Sir Charles


Bossom, Sir Clive
Hamilton, Marquess of (Fermanagh)
Munro-Lucas-Tooth, Sir Hugh


Boyd-Carpenter, Rt. Hn. John
Hamilton, Michael (Salisbury)
Murton, Oscar


Boyle, Rt. Hn. Sir Edward
Harris, Reader (Heston)
Neave, Airey


Braine, Bernard
Harrison, Brian (Maldon)
Nott, John


Brinton, Sir Tatton
Harrison, Col. Sir Harwood (Eye)
Onslow, Cranley


Brown, Sir Edward (Bath)
Harvey, Sir Arthur Vere
Orr, Capt. L. P. S.


Bruce-Gardyne, J.
Harvie Anderson, Miss
Orr-Ewing, Sir Ian


Bryan, Paul
Hastings, Stephen
Osborn, John (Hallam)


Buchanan-Smith, Alick (Angus, N &amp; M)
Hawkins, Paul
Osborne, Sir Cyril (Louth)


Buck, Antony (Colchester)
Hay, John
Page, Graham (Crosby)


Bullus, Sir Eric
Heath, Rt. Hn. Edward
Page, John (Harrow, W.)


Burden, F. A.
Heseltine, Michael
Pearson, Sir Frank (Clitheroe)


Campbell, Gordon
Higgins, Terence L.
Peel, John


Carlisle, Mark
Hill, J. E. B.
Percival, Ian


Carr, Rt. Hn. Robert
Hirst, Geoffrey
Peyton, John


Cary, Sir Robert
Hobson, Rt. Hn. Sir John
Pink, R. Bonner


Channon, H. P. G.
Hogg, Rt. Hn. Quintin
Pounder, Rafton


Chichester-Clark, R.
Holland, Philip
Powell, Rt. Hn. J. Enoch


Clark, Henry
Hordern, Peter
Price, David (Eastleigh)


Clegg, Walter
Hornby, Richard
Prior, J. M. L.


Cooke, Robert
Howell, David (Guildford)
Pym, Francis


Cooper-Key, Sir Neill
Hunt, John
Quennell, Miss J. M.


Costain, A. P.
Hutchison, Michael Clark
Ramsden, Rt. Hn. James


Craddock, Sir Beresford (Speithorne)
Iremonger, T. L.
Rawlinson, Rt. Hn. Sir Peter


Crosthwaite-Eyre, Sir Oliver
Irvine, Bryant Godman (Rye)
Rees-Davies, W. R.


Crouch, David
Jenkin, Patrick (Woodford)
Renton, Rt. Hn. Sir David


Crowder, F. P.
Johnson Smith, G. (E. Grinstead)
Ridley, Hn. Nicholas


Cunningham, Sir Knox
Jones, Arthur (Northants, S.)
Ridsdale, Julian


Currie, G. B. H.
Jopling, Michael
Roots, William


Dalkeith, Earl of
Joseph, Rt. Hn. Sir Keith
Rossi, Hugh (Hornsey)


Dance, James
Kershaw, Anthony
Royle, Anthony


Dean, Paul (Somerset, N.)
Kimball, Marcus
Russell, Sir Ronald


Deedes, Rt. Hn. W. F. (Ashford)
King, Evelyn (Dorset, S.)
St. John-Stevas, Norman


Digby, Simon Wingfield
Kirk, Peter
Scott, Nicholas


Dodds-Parker, Douglas
Kitson, Timothy
Sharpies, Richard


Doughty, Charles
Knight, Mrs. Jill
Shaw, Michael (Sc'b'gh &amp; Whitby)


Douglas-Home, Rt. Hn. Sir Alec
Lambton, Viscount
Sinclair, Sir George


Drayson, G. B.
Lancaster, Col. C. G.
Smith, John


du Cann, Rt. Hn. Edward
Langford-Holt, Sir John
Stainton, Keith


Eden, Sir John
Legge-Bourke, Sir Harry
Stodart, Anthony


Elliot, Capt. Walter (Carshalton)
Lewis, Kenneth (Rutland)
Summers, Sir Spencer


Eyre, Reginald
Lloyd, Ian (P'tsm'th, Langstone)
Taylor, Sir Charles (Eastbourne)


Farr, John
Lloyd, Rt. Hn. Selwyn (Wirral)
Taylor,Edward M. (G'gow, Cathcart)


Fisher, Nigel
Longden, Gilbert
Taylor, Frank (Moss Side)


Fletcher-Cooke, Charles
Loveys, W. H.
Testing, Sir William


Forrest, George
McAdden, Sir Stephen
Temple, John M.


Fortescue, Tim
MacArthur, Ian
Thatcher, Mrs. Margaret


Foster, sir John
Maclean, Sir Fitzroy
Tilney, John


Fraser, Rt. Hn. Hugh(St'fford &amp; Stone)
Macleod, Rt. Hn. Iain
Turton, Rt. Hn. R. H.




van Straubenzee, W. R.




Vaughan-Morgan, Rt. Hn. Sir John







Vickers, Dame Joan
Wells, John (Maidstone)
Worsley, Marcus


Walker, Peter (Worcester)
Whitelaw, Rt. Hn. William
Wylie, N. R.


Walker-Smith, Rt. Hn. Sir Derek
Wills, Sir Gerald (Bridgwater)
Younger, Hn. George


Wall, Patrick
Wilson, Geoffrey (Truro)



Walters, Dennis
Wolrige-Gordon, Patrick
TELLERS FOR THE NOES:


Weatherill, Bernard
Wood, Rt. Hn. Richard
Mr. R. W. Elliott and Mr. Grant


Webster, David
Woodnutt, Mark

It being Ten o'clock, further consideration of the Bill, as amended, stood adjourned.

BUSINESS OF THE HOUSE

Ordered,
That the Proceedings on the Iron and Steel Bill may be entered upon and proceeded with at this day's Sitting at any hour, though opposed.—[The Prime Minister.]

IRON AND STEEL BILL

Bill, as amended (in the Standing Committee), further considered.

Mr. Marsh: I beg to move Amendment No. 5, in page 1, line 15, to leave out "sixteen" and to insert "twenty".

Mr. Speaker: With this Amendment we can take Amendment No. 6, in page 1, line 15, leave out "sixteen" and insert "eleven", and Amendment No. 129, in line 15, leave out "sixteen" and insert "twelve".

Mr. Marsh: Yes, Mr. Speaker.
Following the last Division, perhaps it is in order to say, with great moderation, that I hope we shall not have another experience of a situation in which hon. Members having said that they do not think that there is a case to support an Amendment and do not intend to vote on it, nevertheless then do so wholly and solely because they are offended on personal grounds.

Mr. Barber: There is no point in the Minister's pursuing this matter. We made it quite clear that we did not intend to vote for that Amendment on the merits, but that in view of the way in which the Parliamentary Secretary behaved—which will be within the recollection of the House—we were quite justified in protesting as we did. What is more—

Mr. Speaker: Order. That Amendment is over. Let us get on with this one.

Mr. Marsh: I hope that the only question which hon. Members will take into account on this occasion is whether or not they agree with the Amendment. It follows discussions that we had in Committee about the maximum size of the proposed Corporation. The Bill then proposed that the maximum number

should be 16. In the debate a number of hon. Members on both sides of the Committee expressed the view that 16 was too large a figure. There is no absolute figure; nobody knows what is the right size of a body of this type. Nevertheless, my hon. Friend the Member for Poplar (Mr. Mikardo), my hon. Friend the Member for Penistone (Mr. Mendelson) and some hon. Members opposite said that they were not satisfied with the existing limit on the size of the Corporation.
Powerful arguments were adduced on the matter. The hon. Member for Yeovil (Mr. Peyton) talked about the problems of large Cabinets, which I will not go into because my remarks might be embarrassing to both Front Benches. Nevertheless, doubts were expressed about the value of having a body consisting of as many as 16 members. I took these arguments into account and gave an undertaking that I would consider the question carefully and see whether, in the light of further examination, the figure could be reduced.
Unlike the situation in regard to many other Amendments, I am afraid that the discussions which I subsequently had and my examination of the problem led me not only to believe that the arguments which had been put forward did not have as much weight as I had thought, but that the figure which we had included was too small, for reasons that I shall come to. This was in no way intended to be deliberately awkward; in fact, it has created a great deal of embarrassment generally.
The Bill does not set out the actual type of structure for the industry after nationalisation. It does not set out the groupings or the way in which the industry will be rationalised. It is no secret that the Government are listening to the views of such bodies as the Organising Committee, which has been working on this subject, and the Benson Committee. The Corporation will have a statutory responsibility to report to the Minister on the structure of the industry. There are many arguments about how this should be done. There was agreement in the Committee that the Corporation should be a functional body, the members of which had specific responsibilities. It was agreed that there should be a deputy chairman or chairmen.
10.15 p.m.
However, there was some dispute on two other types of member. One was the part-time membership and there were forceful views against the principle of part-time members on a body of this type. There was also some argument about how far, when the industry was rationalised into large groups, it would be wise to include the chairmen of those groups in the Corporation proper. There are now real arguments of principle on both sides. I am convinced that a number of part-time members on a body of this size, providing that they are few in number, can provide a level and variety of outside experience which one would not get in a purely functional board restricted to members with specific expertise. There is a case for the part-time member.
There is another argument about the chairmen of the groups after rationalisation. It is now clear that the industry will have to be concentrated into probably not fewer than three and not more than five sizeable groups within the Corporation's orbit. It might be argued that if the chairmen of these groups, powerful figures in their own right, were on the Corporation, precisely because the Corporation's most difficult decisions might involve deciding between conflicting interests of the groupings, they might have a virtually vested interest within the councils of the Corporation.
It is argued that this might lead the Corporation to avoid some more difficult issues and to seek compromise where a clear decision might be better and that it might involve delay. It was said that it might not be advantageous to have them on the Corporation. This would be a peculiar position, in that the groupings would be subsidiary to the Corporation, as the latter would be appointed by the Minister and the former set up by the Corporation.
These arguments can be fairly made against including the chairmen of the groups on the Corporation. It can be argued, on the other hand, that chairmen of groups of this size—a quarter or one-fifth of the whole British steel industry—will be powerful figures and that it would be unrealistic to believe that one could take decisions within the Corporation without having the expert knowledge

and advice of these people available on equal terms within the Corporation.
Therefore, after discussions with many different bodies, we found a level of advice which made it clear that if the figure remained 16—we are talking about a functional body—this would not only limit the size of the Corporation but would greatly restrict the types of organisation open to it. Considerations like different forms of organisation, number of boards, a second tier of deputy chairmen—factors which are crucial to different types of organisation to the industry—would themselves be dependent upon the size of the board or the Corporation which it was open for them to work within.
It is interesting to look also at the experience of a number of nationalised industries in the past. When the Coal Industry Nationalisation Act was passed in 1946, a maximum-size Board of eight was set up, but it was necessary to come back to Parliament within three years with a request to extend the size of that Board. The Gas Council, after it was set up, waited a period of years before it could obtain Parliamentary time and support to have the original Act changed.
One can look also at some of the very large industrial groups. The Corporation will be a very large company, and the position in the initial stages will, I think, be different from what it will be subsequently; a larger board might well be justified in the earlier stages, but not to the same extent in the later stages. Looking at some of the sizeable companies which exist, one finds that I.C.I. has 21 directors, Unilever has 24, British-American Tobacco has 20, Imperial Tobacco has 26, G.K.N. has 22, and Distillers has 22.
I am not arguing that there is a direct similarity between nationalised boards and boards of that sort, to which different considerations apply, and neither am I arguing that the Government Amendment is intended to produce a Corporation necessarily of 20. I am saying that, according to the advice which we have received so far, and as a result of the discussions we have had, it is clear that if we cannot raise the maximum size of the Corporation—recognising that this is a maximum size—we cut out of consideration a whole range of viewpoints on the organisation.
I apologise for this. In a way, it is an example of the value of a Committee stage. We started off, I confess, by looking at the possibility of reducing the size. I am now firmly convinced, as are people in industry—certainly the Organising Committee is—that the present maximum would circumscribe too much the discussions which are at present in progress. I therefore ask the House to agree to the Amendment to enable us to have a greater degree of flexibility.

Mr. Peyton: All of us on this side of the House were very relieved that the right hon. Gentleman did not follow the earlier trend of his remarks and yield to the temptation to follow, quite wrongly, the example of his Parliamentary Secretary, who, we all hope, will learn.
I yielded to the temptation in Standing Committee to hope that we would not have too large a body. I base my fears of large bodies upon the size of Cabinets. I have observed that successive Administrations have this much in common, that those who are members of Cabinets have profound respect for that body, whereas those who are not sometimes fall short of that very desirable degree of veneration. Even though that ill be foisted upon the country as a whole, it would be wrong to impose it also upon this unfortunate industry which is already being called upon to suffer so much.
I was very much impressed—and here I am about to be civil, so I hope that I may have the Minister's attention—by the fact that, during the whole of the Minister's remarks, after his first few sentences, he was exclusively concerned with problems of an industrial or commercial nature. That emerged quite obviously. The Minister has moved an Amendment quite other than what he expected during the Committee stage, always a difficult position for a Minister to be in. If he will say quite plainly that the considerations which led him to move the Amendment arise purely from commercial and industrial factors, I should be more than satisfied, and, out of respect for the Minister's argument, I would refrain, in the interests of time, from moving Amendment No. 6, which stands it my name and those of my hon. Friends. I consider this to be a reason-

able offer and, if the Minister wishes to intervene now, I gladly give way.

Mr. Marsh: Before the hon. Gentleman changes his mind, the answer to his question is "Yes".

Mr. Peyton: This is a most happy exchange. Assuming that "Yes" means "Yes", I am very glad to fall in with it.

Mr. Speaker: I am sorry to spoil the harmony of the moment, but I have not selected the hon. Gentleman's Amendment.

Mr. Peyton: I am sorry, Mr. Speaker.
Over many years, it has been a bad habit of mine to go racing from time to time, and on those occasions I have made it a practice to mark cards. I had marked the Amendment in my name as having been selected for discussion in this debate. But I see your point, Sir. I am not in a position to move it. Nevertheless, the opportunity for discussing my Amendment is something which I gladly forgo in view of the Minister's clear, monosyllabic and unqualified undertaking. I welcome this occasion, and I salute some common sense even from this Administration

Sir D. Glover: On a point of order, Mr. Speaker. Can the Minister give a categorical assurance in response to an Amendment which is not before the House? Ought not he to withdraw his "Yes"?

Mr. Speaker: That is a question of theology rather than of order.

Mr. Ian Mikardo: Before this somewhat unnatural alliance between Yeovil and Greenwich is finally consummated—out of my regard for hon. and right hon. Members, I refrain from saying "unholy" alliance—the House could with advantage spend a few minutes in considering this not unimportant subject.
We are here changing the character, structure and method of organisation and management of one of the country's major industries. The way in which it will be run will depend on many factors, but it will depend to some extent on the way in which the members of the Corporation are chosen, on the way the Corporation is constituted and on the method by which the Corporation


functions. We ought, therefore, not to pass too glibly over the question.
I have some views on the matter, to which my right hon. Friend was kind enough to refer, but I say at once that this is not a point on which I should be willing to go to the stake. It is possible fairly to take different views on the question according to—one might almost say—one's philosophy of industrial management and organisation. I understand my right hon. Friend's difficulty, and I have no doubt that the members and chairman of the Organising Committee have so advised him, in trying to figure out in advance, before the thing is settled, exactly how it will be run, and I can, therefore, understand his de sire to have an arrangement which will give him the maximum flexibility. But I hope that he will not use to the full the powers which he is seeking, at least not for any length of time.
Notwithstanding the list my right hon. Friend gave of companies having boards of directors of 20 or more, I do not consider that a committee as large as 20 affords a good way to run an industrial enterprise, large or small. From some points of view —I shall not develop them now because it would take too long—there is a case for saving that a large organisation ought to have a small board rather than that a small organisation ought to have a small board. The large organisation has resources enabling it to call upon expertise of all kinds, either from among is functioning managers or from ad hoc advisers, which some small companies have not.
My right hon. Friend talked of the necessity for getting various types of expertise and experience. He is right, but if the Corporation wants somebody's ideas and expertise, it is not necessary to sit him on it, where he will sit through long meetings listening to things which have nothing to do with his expertise.
10.30 p.m.
One can get expertise without sticking it on a board of directors, and sometimes it is better to use it without doing so. I appreciate my right hon. Friend's point about the chairmen of subordinate groupings, whether regional, product or other kinds of groupings. We know that we are talking about four or so people. I

think that it is right to allow places for them, but I do not think that the best way to get their best co-operation with the Corporation is necessarily to have them as members.
One thing one must always avoid in this situation is turning a board which should be of one mind, with a single purpose, to do a single job, into a group of rivals for the same resources, each rolling his own little logs. One can get that, above all, if there are regional representatives. Probably no hon. Member on either side of the House would now dissent from the view that the decision made a few years ago to divide the additional rolling capacity then being provided between Scotland and Wales, instead of having the whole lot together in one place, was a very bad decision. It was made against all the right technical indications, because of regional logrolling. I fear that there might be that danger if the chairmen of the groupings are on the Corporation.
However, let us concede the point. That gives four. Amendment No. 129, to which my name is added, proposes a total Corporation of 13, which would give the chairman, deputy chairman and the four regional chaps with room for seven functional directors. I would have thought that that was enough and more.
What really worries me about this large Corporation is that a lot of part-time directors might be brought in. My right hon. Friend quoted some of the existing corporations. I wish he would go to the chairmen of those organisations, get each of them in a confidential mood and ask him how much value he thinks he gets from his part-time directors, because I think that I know the answer.

Mr. Marsh: To reassure my hon. Friend, I can say that none of the advice I have received has been based on a large number of part-time directors. With such an enormous industry, which has such a wide range of activities as well as a number of groups, there might well be an argument for a larger number of full-time functional people. I accept the argument that a Corporation that has a large number of part-time members kills the whole point of that.

Mr. Mikardo: I thank my right hon. Friend for what he has said. It depends what is meant by "large number"


Usually, there are four or five such members, which is a grossly large number. I would want to do without them altogether, because one can get their expertise much better without clogging up a board.
If we get this change there will be the chairman and one or two deputychairmen—I make no complaint about that—three, four or five regional chaps, and half a dozen functional directors. Because there is a terrible Parkinson's Law about boards of directors, the tendency will be for them to say, "We have 15 chaps. We are entitled to 20. Does anybody know any good 'bods' knocking around whom we could co-opt? "That is what I am frightened about.
One thing that has confirmed me in my views since the discussion in Committee to which my right hon. Friend referred is that a case has recently arisen in which a full-time member of a board—with a full-time member's salary—has been reappointed a part-time member of another corporation. It seems a colossal piece of nonsense and to smack a little of patronage rather than of selecting people entirely on merit.
Having said that, I hope that my right hon. Friend, when he gets his Amendment, as doubtless he will, will tell the Chairman of the Corporation when he is appointed "For goodness' sake, look upon this as a maximum to be used temporarily and in need, and not as a number to he filled up quickly at any cost with a lot of part-timers".

Mr. Mendelson: In supporting the Amendment and the ideas behind it as outlined by my hon. Friend the Member for Poplar (Mr. Mikardo), I do not want to rehearse again some of the arguments that were gone through in Standing Committee. I appreciate that my right hon. Friend has covered part of the ground in his initial statement, but I should like to add two points that I think are relevant to the discussion in Committee and to the new Amendment.
One of the reasons why I and my hon. Friend are apprehensive that there should not be too many part-time members of the board is that we feel that all those appointed to the board of the Corporation should be people who are capable of being in charge of one of the major departments or activities of the Corporation.
My second point concerns the circles from which the members might be drawn. In Standing Committee, we had a long discussion about the people who might be drawn from management—not necessarily only former directors but people from various levels of management—and from the workpeople in the industry or people who have made their career in the trade union movement in various industrial organisations. One of the points on which we were all agreed can be summed up in the phrase "Competence and confidence should go together."
It is important that the people who work in the industry and whose future depends upon the success of the industry should have confidence in those who are appointed to the board and be sure that they are the right kind of people, both in competence and in approach, to lead the industry under public ownership. There is a long history to this, as my right hon. Friend knows, in other nationalised industries, and I need not labour the point and delay the House by giving details.
I hope that when the composition of the board comes to be finally decided by my right hon. Friend—I am not making the mistake of thinking that the appointments to the Organising Committee necessarily entirely predetermine the full composition of the board once it finally comes to be appointed—he will be very careful not to accept the doctrine that has sometimes been voiced in the Standing Committee, and indeed outside the House, that people who have the necessary expertise to serve in a position on the board and be responsible for one of the major activities of the Corporation must inevitably be drawn from the circles of former directors or senior management.
I should like my right hon. Friend, in implementing the formula of "competence and confidence," to look for talent and experience among the work-people, among those who have made their career in the trade union movement —those in the steel industry particularly will have a great deal of seniority, because without that they would not have the confidence of their fellow workpeople—and also some of those who might have made a further career in one


of the steel-producing activities somewhere at an early age, accepted a full-time position in the trade union movement and then made their career for another 10 or 15 years as officers of the trade union movement.
I hope that my right hon. Friend would then be able to find a number of these people who are looking forward to another 15 or 20 years' active work and would be able to appoint some of them as full time members of the Corporation. In other words, I would not like to see a situation where a rather large number of part time appointments were being made, with most of the trade union representatives given only part time jobs. I realise that my right hon. Friend has already appointed one trade union officer to a full time position.

Mr. Deputy Speaker (Mr. Sydney Irving): Order. The hon. Gentleman is getting rather wide of the Amendments, which are concerned with the number of members of the Board and not with the qualities required in the appointees.

Mr. Mendelson: When I put down Amendment No. 129, Mr. Deputy Speaker, I was not inspired merely by an abstract figure and clearly I have to put to the House the ideas that prompted me to put it down. But, of course, I gladly take your guidance and move on.

Mr. Peyton: rose—

Mr. Mendelson: No. I cannot give way

Mr. Peyton: rose—

Mr. Mendelson: No.

Mr. Peyton: rose—

Mr. Deputy Speaker: Order. The hon. Member for Penistone (Mr. Mendelson) has made it clear that he will not give way. The hon. Member for Yeovil (Mr. Peyton) must not persist.

Mr. Mendelson: rose—

Mr. Peyton: rose—

Mr. Mendelson: All right, then.

Mr. Peyton: I am obliged. I only want to ask whether the hon. Gentleman's representations in Committee on behalf

of one of his constituents have been successful or not.

Mr. Mendelson: That is another example of the time wasting of the hon. Gentleman, to which we have become accustomed. I suspected that this would be the case. That is why I did not at first give way. But this gives me the opportunity to state that it is completely untrue that I have ever supported the name of any one of my constituents for any of these appointments. I want to return now to the serious point, although it is difficult to have a serious debate when the hon. Member tries to take part.
What concerns me is that, if the Minister accepts the principle that we should have mainly full-time members, he might find that the figure he is asking for is too large. We want to be assured that he will only make as many appointments as are absolutely necessary on functional grounds, apart from a chairman and a deputy chairman. Perhaps four deputy chairmen might be too many. At the same time, I hope that my right hon. Friend will not be looking for more part-time members representing the work-people and the trade union movement but will give them their full share of the full-time appointments.

Mr. Barber: The Minister's speech was remarkable because whereas, in Committee, he indicated that he would consider reducing the maximum number of members from 16, he now proposes an increase to 20. Having said that, two aspects of his speech were gratifying to me.
First, there is a refreshing change in that he is now prepared to change his mind. Secondly, I understand that this change of opinion is consequent on a unanimous recommendation of the Organising Committee. The number of members of the Corporation is surely crucial to the whole of the first recommendations of the Committee, whatever they might be. This seems to be so because whatever organisation the Committee has in mind is bound to be reflected in the composition of the Corporation and the number of directors. Clearly, the Organising Committee has given a great deal of thought to this matter and members of that Committee, as we know, are men of great industrial experience.
This being the case, while I still have some of the reservations which were expressed n the Standing Committee, I for one am certainly prepared to go along with this proposal. Furthermore, as has been pointed out, the number of 20 is a maximum, which is in line with quite a number of large companies in the private sector. For all those reasons, I hope that my right hon. and hon. Friends will take the same view as my hon. Friend the Member for Yeovil (Mr. Peyton) and will not take the matter to a Division.

Amendment agreed to.

10.45 p.m.

Mr. Edward M. Taylor: I beg to move Amendment No. 7, in page 2, line 5, at the end, to insert:
Notwithstanding the generality of this subsection at least one member of the Corporation shall have experience of or shown capacity in steel matters in Scotland and at least one shall have similar qualifications in respect of steel matters in Wales.
As the Minister has just increased the maximum size of the Corporation to 20, I am confident that he will accept this Amendment. All I ask is that one of the number should have experience of steel matters in Scotland and that one should have experience of steel matters in Wales. This is a very small request, and I hope that the Minister will accede to it.
I accept that the members of the Corporation will not be delegates or representatives of areas, regions or pressure groups, but the special problems of Scottish and Welsh steel are such that they deserve some attention.
Why should they have such representation? First, there is the simple importance of Scottish steel. About 30,000 people are directly employed in the Scottish steel industry and more than 100,000 are dependent on it directly for their employment and there are many thousands who depend indirectly on this great industry for their livelihoods. It has been estimated that about 250,000 people in Scotland, mainly in the west of Scotia id, depend directly or indirectly on the industry for their livelihoods.
There are many other ways in which steel is very important for Scotland. Local authorities provide one instance. Those of Motherwell and Wishaw take 41 per cent. of their rates revenue from

one Scottish steel works and if there were to be a major change in the organisation of Scottish steel, it could have devastating consequences for Glasgow, Lanark, Motherwell, Wishaw, Coatbridge, Port Glasgow and Ayr. To that extent steel is vital to Scotland and there should be someone on the Corporation with some knowledge of our special Scottish problems.
The second main reason is the vulnerability of the Scottish steel industry which in fair and free competition starts with a ball and chain around its feet, because we have the appalling problem of the coal differential to the extent of 33s. a ton, the gas differential, making the price of gas in Scotland one sixth higher than in the rest of the country, the electricity differential and the rates burden which is such that on average on every ton of Scottish steel 27s. 9d. must be allowed whereas in England and Wales the corresponding figure is around 12s. 6d. In view of these special circumstances, it is essential that we should have someone on the Corporation who can bring reassurance to the Scottish steel industry.
The third reason is the lack of confidence in the Scottish steel industry, a lack of confidence which has been caused by many things. For example, we had the proposals in the Benson Report which said:
The Committee wishes to emphasise that, if the upward course of British fuel prices, and particularly coking coal prices, continues as over the last decade, at very least, the viability of some long-established U K. steel-making areas—for example, Scotland—may be put in hazard".
This is only one small indication of what has been a general feeling in Scotland, that our great steel industry is at risk. We also saw this from the results of our major Scottish steel company, Colvilles, who in 1965–66 lost almost £2 million. This was not because of inefficiency, or because it was not progressive and go-ahead, but because of the actions of other nationalised industries in imposing a crippling fuel differential.
To that extent we do not want to see happening in the steel industry what has happened in every other nationalised industry, namely that the interests of Scotland are discriminated against. It is


essential to that extent to have the reassurance that someone on this board will be aware of the special problems of Scotland and prevent this Corporation hitting Scotland as hard as has been the case with the other nationalised industries.
We have not been happy with our experience in pricing and other matters. Only a few months ago we had the cancellation of almost every single forward contract of the North of Scotland Hydro-Electric Board. Technical advance is now stopping. There will be no more projects there. The Minister may say that we can depend on the Government to protect the interests of Scotland, but really this is one argument that he cannot put forward. Yesterday we had a splendid example of the extent to which the Government are protecting Scottish industry. In the ten years after the war the Scottish shipyards, directly related to Scottish steel, got one half of the naval work going. Last year only £6 million out of £48 million came to the Scottish shipyards.
In 20 years we are down from one half to one eighth. Since then we have had S.E.T., which clearly discriminates against Scotland and the Highlands. We have seen the housing figures, issued yesterday, which are disastrous for Scotland—[Interruption.] This is only a brief reference, directly relevant to the Amendment.

Mr. Deputy Speaker: Order. I hope that the hon. Gentleman will keep the reference brief.

Mr. Taylor: I have two further examples, the abolition of free depreciation, which was something which this Government did, and our unemployment figures—[Interruption.]—

Mr. Deputy Speaker: Order. The hon. Gentleman is going wide of the mark. Will he come back to the Amendment?

Mr. Taylor: I quote these as examples of the extent to which this Government is discriminating against Scotland, to show how we cannot depend upon the Government to protect the interests of Scotland. For that reason, it is essential that this Amendment should be approved, not only in the letter, but in the spirit. It is vital to Scotland, that we should not

have the same experience as we have had with other nationalised industries. We have special problems which need special attention.
We need representation, and most of all we need people with knowledge of the special problems of Scottish steel on this Corporation. I have suggested only one member, but I hope that there would be more than one. It is important that this should be the case. The Minister may say that any sensible Government would make sure that at least one Scot, or someone with experience of Scotland's steel industry, would be on the board, but I want this Bill to make sure that it is binding on all future Governments, so long as the industry is nationalised, and I certainly hope that that will not be for too long.

Mr. Peyton: On a point of order. On the last Amendment we discussed, I suggested that during Committee stage the hon. Gentleman the Member for Penistone (Mr. Mendelson) referred to the submission of a name by himself to the Minister. He denied that he had ever made such a submission and told me that I was misleading the House. [Interruption.] I merely want to get the record straight.

Mr. Deputy Speaker: Order. It is very clear that this not a point of order.

Mr. Peyton: The hon. Gentleman told me that what I was saying was untrue. In col. 183 of Standing Committee D, on 1st November—[Interruption.]

Mr. Deputy Speaker: Order. If the hon. Gentleman feels this way, he has other remedies. This is not a point of order.

Mr. David Steel: It is a bit hard that the House should have had to listen to a rehearsal of the speech by the hon. Member for Glasgow, Cathcart (Mr. Edward M. Taylor) for the Pollok by-election.

Sir D. Glover: That was a very good speech indeed.

Mr. Steel: Nevertheless, the hon. Member was making a valid point in suggesting that there should be a Scottish member of the Corporation. This is clearly a sensible point which any Government would obviously accept and it


would be ludicrous to waste the time of the House trying to write this into legislation.

Mr. Alick Buchanan-Smith: After that intervention by the hon. Member for Roxburgh, Selkirk and Peebles (Mr. David Steel) one wonders where his interests really lie in relation to Scotland. I sincerely hope that it will be noticed in the right quarters.
I support my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward M. Taylor), not only for putting down the Amendment, but for the way in which he presented it. He demonstrated clearly to all of us in the House how necessary it is for the special needs of Scotland to be looked after, special needs which, over the past two years, many of us have become concerned whether they were being looked after.
I support the Amendment for one particular reason. The past five years in Scotland have seen a growth of two quite new types of industry. We have seen a far greater growth of science-based in-dusty, such as in electronics, and a much greater growth of consumer-based industry, such as in the manufacture of domestic appliances.
The one thing in common in these new industries that have come to Scotland is that they use specialised steel products, in great contrast to the older industries of Scotland such as the railways, heavy engineering and shipbuilding, which use the products of our indigenous iron and steel industry in Scotland. The interesting feature of many of these new firms which are coming to Scotland is that nearly 80 per cent. of the steel they use comes from south of the Border and is steel for special products.
If those firms are to use these specialised steel products, they must keep close liaison with the firms south of the Border which supply them. They must make sure that they get steel of the right quality and specification and they must maintain close liaison to ensure quick delivery.
Because we depend on firms of this kind in Scotland, it is essential that the interests of Scotland are looked after. That is why I wholeheartedly support my hon. Friend's Amendment.

Mr. Marsh: I will not detain the House long on this subject. The Government

naturally accept the importance of Scotland, and the importance of Wales. For many years now, no Government has been allowed for one day to forget it. Indeed, one sometimes feels that it might be interesting if half the amount of attention that is given in this House to Scotland and to Wales were given to London. That is a purely objective opinion.

Mr. Michael Foot: London does not produce any steel.

Mr. Marsh: The importance of these areas is very much recognised and clearly we understand this.
It would be a great pity if we were to start introducing into our legislation a belief that we had people serving on boards not because of their innate ability or the exceptional qualifications which they have to offer but wholly and solely because they were Scotsmen or Welshmen. A person so appointed would be in an intolerable position because, although he might be a scientist or an economist, he would be there primarily as the Scottish or the Welsh member of the board.
All experience shows that the natural charm, ability and eloquence of the Scots and the Welsh has always enabled them to get what at least could be described as a fair share, and a very large share, of the posts which the British people have to offer in this country. I would regard it is a great pity if we sought to fudge the contribution which they have to make by designating a particular post on these boards. We have never done it on any board. It would mean that the person on the board would be there with this tag.
11.0 p.m.
I think that the hon. Member for Glasgow, Cathcart (Mr. Edward M. Taylor) and other hon. Members who have spoken have sufficient confidence in their fellow countrymen to recognise that such people would be able to get there on their own abilities. To do as the hon. Member has suggested would be a pity. It would be yet another example of the numbers of Scotsmen there are about. One has only to look at the number of Cockneys in this Government to be certain that it is ensured that there is no need for a great campaign to protect the Scots and the Welsh. The Government


is very fully alive to the importance of these areas, and I hope that the House will accept that our heart is in the right place. I assure hon. Members that the Government's heart is in the right place, but I cannot accept this Amendment.

Mr. G. Campbell: I do not ask for a Scotsman or a Welshman, but somebody who has shown knowledge and ability in steel matters. It would not matter who he was so long as he had those qualities.

Mr. Edward M. Taylor: If he were a Chinese or a Pakistani with a special knowledge of Scottish steel I would have no objection, but we want people with special knowledge of Scottish and Welsh steel, and, if that is understood, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. Marsh: We have made some progress, and in view of the nationalistic feeling which we seem in danger of engendering, I beg to move,
That further consideration of the Bill, as amended, be adjourned.

Question put and agreed to.

Bill, as amended, to be further considered tomorrow.

REDEVELOPMENT (PORTSMOUTH)

Motion made, and Question proposed, That this House do now adjourn. —[Mr. McBride.]

11.3 p.m.

Mr. Frank Judd: I call the attention of the House to a problem affecting my constituency, although it is a problem which has far wider implications for the country as a whole. Professor Buchanan, in his interesting study of South Hampshire, drew attention to the obsolescence of much of the housing in Portsmouth. In examining this question, I would emphasise that one has to look at the history of Portsmouth.
There was the vast expansion of the Royal Navy during the 19th century, accompanied by expansion of the dockyard and the consequent building of many houses as homes for the people working there. These were mainly in streets of small, two-storeyed houses in terraces, but

there were few tenements, and no back-to-back houses. Of the 64,000 dwellings in the city, more than 14,000 are more than 100 years old, and more than 15,000 are older than sixty years. All are in intensely developed areas, and Portsmouth, with 23 people to the acre, has one of the highest densities in the country, outside London.
Since 1957, there have been 4,850 dwellings dealt with as unfit under the terms of the Housing Act, 1957, out of a total clearance, including business premises, of about 5,500 buildings. The city is to undertake a new programme of building at least 4,800 houses, and this is the time to take stock of some of the social consequences of this programme, and of the cost, and the distribution of the financial burden of urban renewal.
There is a severe shortage of land, as well as of houses, in Portsmouth. Extensive destruction of artisan type houses occurred during the last war. Owing to the insular character of the city it can only extend northwards into the mainland, and its geography is therefore important. The older houses are near to the dockyard, and the newer property is comparatively far from it although the dockyard is the main employer of labour.
All of this, coupled with the fact that most property now to be dealt with, although technically unfit by standards laid down in the Housing Act, is not what would usually be regarded as slum property, means that prices remain high. The average market price for houses compulsorily acquired is between £1,400 and £1,600.
The local authority, looking at this problem, had hoped that there might be some chance to proceed with the new programme under procedure other than that in Section 4 of the Housing Act; for example, under the planning Act. But the general economic situation meant that there were considerable doubts about the certainty of Government financial support. Having discharged, as a city, its statutory obligations most efficiently, in any case the number of substandard houses had in fact been notified.
Looking at the deeper social implications of this policy, we see that 41 per cent. of the houses to be affected are owner-occupied. There are hardly any large-scale landowners in the area, and


those houses which are owned other than by the occupiers are mainly owned by people of limited means who have invested in one other house as a means of securing an income, for example, in old age. Of the owner-occupiers themselves, most are on small incomes or on old-age pensions.
As people look at this new programme, they see their security in jeopardy. They see themselves faced with the higher cost of accommodation in local authority housing. Looking at the situation in perspective, we can see the development of vast council estates without any real study of the social and sociological implications of reduced proportions of owner-occupiers in the community.
In an operation of this sort, it is essential that justice should be seen to be done. As ordinary people look at existing legislation, what they see, in fact, is a jungle. They see different provisions and subsections under the Housing Act, and they see different Acts, even, under which compulsory purchase can be handled.
If we are looking at this apparent injustice, we could hardly do better than read an interesting article contributed to the Portsmouth Evening News by a correspondent. I should like to quote from the article. I should like to quote the effects of this plan in a particular street, and he says:
Stamford Street, Landport, is coming down. A survey by officials of Portsmouth Public Health Department revealed it to be in an area where most houses were unfit for habitation, and Portsmouth Corporation obtained a compulsory purchase order as the first step towards demolition and redevelopment.
Three typical houses in Stamford Street are numbers 18, 51 and 77. In them the whole injustice of the Housing Act compensation system is represented—the story could be repeated again and again all over the city.
All three were considered by the Health Department to be unfit—which means, in money terms, worthless. The market value of an unfit house is nil; for it cannot be lived in, by law. All three were owner-occupied.
With No. 18 there was no problem for the owner, for by a peculiar quirk of law he qualified for what is known in local government language as an owner-occupier's supplement'.
This paid him the difference between site value of his house, which he would receive anyway, and market value. In other words he got full compensation, amounting to some £1,200.
The condition of the house—the vital issue in the cages of 51 and 77 Stamford Street—

made no difference. He qualified for full compensation because he bought his house between 1st September, 1939, and 13th December, 1955, and had lived in it for fewer than 15 years.
The owners of both the other houses appealed against the designation of their property by the Medical Officer of Health as 'unfit'–51 successfully, 77 unsuccessfully.
Both were marginal cases; the official report on each listed much the same defects as the other. Both, for instance, were said to suffer from rising and penetrating damp, both were poorly lit inside, and both were said to have inadequate facilities for the storage of food and disposal of waste water.
Indeed, No. 51 which was reclassified on appeal as 'fit', had more defects listed against it than No. 77.
After hearing the evidence at a public inquiry, the Ministry of Housing and Local Government inspector decided that No. 51 was not 'so far defective as to be unfit', whereas No. 77 was, although he conceded that it had been well looked after.
So, No. 51 was eventually bought by Portsmouth Corporation for its full market value of £1,600, whereas the owner of No. 77—who did not qualify for the owner-occupier's supplement—received just £230 for the land on which the house stood, with £232 compensation in the form of a 'well maintained payment', an amount calculated as four times the rateable value.
It is quite clear that the dividing line between fit and unfit, and between eligibility and non-eligibility for owner-occupier supplement is too rigid, and in Portsmouth, in particular, the gap is too wide. If we look at the way in which an authority, backed by the Ministry's inspectors, comes to its decision, we see that it is still dependent on subjective interpretation. It is impossible to demonstrate absolute objectivity.
The recent report of the Central Housing Advisory Committee spells all this out, and I should like to quote briefly from it. First, the report says
that greater objectivity was possible than had been achieved in the past. It is easy enough to express some of the items in the present fitness standard in more objective terms, for example, by spelling out what equipment is required for the storage, preparation and cooking of food.
It also says:
We have also been struck by the extent to which, in the last resort, decisions must depend on the judgment of an experienced person.
A further comment was:
There is a need also for simple explanations for members of the public.
The report came to the conclusion that
the best method of obtaining greater objectivity for the purposes of applying housing


standards was, while expressing the standards in fairly broad terms, to define those terms as far as possible in explanatory notes.
In the City of Portsmouth there is uncertainty about the future as it affects property. This affects prices. It may even lead to an unwarranted inflation of prices in areas not immediately declared. It is unfortunate, perhaps, that the Portsmouth City Corporation has not been able to follow the lead of Newcastle-upon-Tyne in scheduling planning arrangements far ahead.
When looking for solutions to this problem, I think that there are several approaches. First, of course, there is the possibility of abolishing the present limiting dates of the owner-occupier supplement, as proposed in Clause 13 of the Bill to be promoted by the Portsmouth City Council. Another approach might be a move towards sliding scales, with a more generous well maintained payment.
Whatever the solution is, it is certain that something must be done, and done urgently. For if we look at the situation we see that the purpose of the Housing Act is to deal with the quality of life for large numbers of people in Britain, and if we are concerned with the quality of life of people in Britain, we must be concerned about the psychological and social problems which affect people who find themselves faced with the problem of large-scale redevelopment, and find themselves losing the security to which they have been looking forward for many years.
I think that we must all agree that a Government which is so obviously concerned with introducing adequate and proper housing for this half of the twentieth century must also look at the corollary, which is to make sure that the way in which this is done does not detract from the effects which will subsequently be enjoyed

11.13 p.m

Mr. Graham Page: I shall detain the House for only a moment or two. The hon. Member for Portsmouth, West (Mr. Judd) has called attention to an injustice which is becoming more and more known to the public. A householder who paid £1,000 for his house three or four years ago may be offered £30 if it is in a clearance or redevelop-

ment area. A householder who has paid perhaps £1,400 by way of mortgage for a period of 25 years is now offered gross value of £30 for his house if he happens to be in a redevelopment area, and a tenant who has spent perhaps £300 or £400 on improving the house is offered nothing.
Local authorities are revolting against this at the present time, and the hon. Gentleman has shown that Portsmouth has come forward with a sort of banner of justice in its Bill to the House. The problem which faces the Government is that many local authorities will not carry out the terms of the law as it stands because they think that it is such an injustice on their citizens. They think that it is an injustice to sacrifice their citizens to this confiscation in the name of progress.
I think that we will find difficulty in getting local authorities to proceed with redevelopment areas when they consider that there is such an injustice on their citizens

11.15 p.m

The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. Robert Mellish): My hon. Friend the Member for Portsmouth, West (Mr. Judd) has raised an issue about which I know he feels very deeply. It is, moreover, an issue which is causing concern to many citizens of Portsmouth and to large numbers of owner-occupiers elsewhere in the country. I would go so far as to say that the situation we find in Portsmouth represents in a dramatic form conditions to be found where local authorities have succeeded in clearing the worst of their unfit houses and are now turning their attention to areas where the stark gap between fit and unfit houses is no longer so obvious as it unfortunately was in the past.
My hon. Friend is well aware of the sympathy that my right hon. Friend has for those who may at present suffer hardship through the operations of slum clearance. The answer that he gave to my hon. Friend on 6th December last, when he indicated that this is one of the many problems relating to older houses which are under review, is evidence of that.
My right hon. Friend is well aware from his visit to Portsmouth last year


of the conditions and feelings there, and he has studied the memorandum that was submitted to him during his visit on behalf of the Owner-Occupiers' Protection Association. Further, my hon. Friend has more than once written to me in cogent terms of the problems faced by owner-occupiers whose houses may be caught up by clearance operations and I hope sincerely that my replies have done their part in convincing him and his people that the Government take these problems very seriously indeed.
If I went beyond that on this occasion and said exactly what the Government intend to do I might well swiftly be called to order, for I should be embarking upon a discussion of possible amendment to existing legislation. That is what the review which my right hon. Friend mentioned is all about and, in any case, at this stage of the review I could give no precise undertakings. So I know my hon. Friend will understand if I concentrate upon the administration of existing Statutes, recognising problems but at the same time indicating how their effects have been already mitigated or can be offset short of legislation.

Mr. Harold Gurden (Birmingham, Selly Oak): I am interested in what the Minister is saying. Has he overlooked the fact that I have brought in a Bill to clear away this injustice a long time ago and that he and his colleagues rejected it?

Mr. Mellish: Any legislation we introduce will be concerned not only with this one item. There must be a broad approach to this problem. I am quite prepared—as I know my right hon. Friend is—to discuss this matter with the hon. Member, and with the hon. Member for Crosby (Mr. Graham Page) and others, to try to resolve it. I do not deny that there is still some injustice, which must be put right. The question is how and when we should do it, but for goodness sake let us introduce legislation which is agreed on both sides and which will stand for some time, rather than the patchwork quilt that we have had in the past.
On the basis of returns made by local authorities in 1965, the numbers of unfit houses remaining to be dealt with in England and Wales still total about

three-quarters of a million, despite the fact that over 700,000 slums have been demolished or closed since the war. Of course, the remaining unfit houses are not spread evenly over the country and half of them are to be found within the area of 24 authorities. It may surprise the House to learn that Portsmouth is one of those 24 authorities
It is true that its figure of 5,500 does not compare with Liverpool's 74,000, or Manchester's 55,000. But there should be no denying that Portsmouth has a real and significant problem that must be tackled as quickly and effectively as possible. As I mentioned right at the beginning of my remarks, the worst conditions in Portsmouth have perhaps been swept away with the clearance of 3,800 unfit houses since 1955 but, as 14,000 of the 65,000 dwellings in the city are over 100 years old, I can well appreciate the reasons that have led to a new clearance programme involving some 4,800 houses.
Naturally, I cannot pronounce on the fitness or unfitness of individual houses in any general programme. That is something that must be determined by a very careful procedure and I hope the House will forgive me if I think it is worth while spending a few minutes describing it for the benefit of those who read my speech in the local Press. If a local authority is satisfied that the dwellings in an area are unfit for human habitation, by standards set down in Section 4 of the Housing Act, 1957, and that they should be demolished, the authority must declare a clearance area.
It must then take the next step towards getting the houses demolished by making either a clearance order or a compulsory purchase order. By the former, the owners of the houses are required to carry out the demolition but are left with the land; under the latter the authority acquire and then demolish the houses.
But in neither case can the authority act simply on the strength of its own order: that decision is for the Minister to take after a public local inquiry, held by one of his inspectors, at which objections are heard. An owner may object to a clearance order or a compulsory purchase order on the grounds that his house is not unfit. He may, of course, object to compulsory purchase, whether or not he accepts that his house is unfit. The Minister reaches his decision


only after very careful consideration of his inspector's findings and recommendations, and he may confirm the order with or without modification, or reject it completely.
There is one further matter that I should like to mention in connection with a compulsory purchase order whose prime purpose is to clear unfit houses. It is this: fit property may be included in the order, by virtue of Section 43 of the 1957 Act, when its acquisition is reasonably necessary for the satisfactory development of the cleared area.
Here I pause, before I turn to compensation payable upon clearance, and make a basic point about the powers and duties of local authorities faced with unfit houses in their areas. When seeking to develop or redevelop parts of their areas authorities may have a choice of statutory powers available to them depending upon the purpose they have in mind. They may indeed find a combination of powers appropriate. But their freedom of choice when dealing with what, in their view, are areas of unfit houses is much more restricted.
It is, I hope, clear from what I have already said that the Housing Act of 1957 imposes a duty upon authorities to deal with areas of unfit houses. Not only that: it tells them how they should set about doing it in the ways I have described. For all practical purposes, there is a strong obligation upon an authority to make use of the provisions of the Housing Act and, in particular, those provisions in Part III of the Act, where they are satisfied that the area is one of unfit houses which should be demolished. The clearance of the houses is in fact the first objective of their action.
Of course, the local authority's initial judgment about the condition of the houses may be wrong. Indeed, it may have formed its view with considerable caution, having regard to the worse conditions of houses declared unfit and cleared in the past, but yet have come to the conclusion that the houses were unfit. I will not speculate on considerations of that sort, in case I appear to be anticipating in any way a formal decision of the Minister in respect of a particular order.
But the point is that the grounds of the authority's action will be tested by the due processes leading up to the Minister's decision. In the circumstances of the case, he may uphold the authority or, in effect, indicate that the conditions in an area are not such that they justify clearance on their own account. Then the authority must look to other powers in tune with the purposes it has in mind for the area; those powers may be available in the Housing Acts or the Town and Country Planning Acts, or elsewhere.
I can appreciate that owners of houses affected by clearance operations may see more clearly the proposals for the redevelopment of an area than its existing conditions. Necessarily, clearance usually implies redevelopment of one sort or another consistent with the future character of the neighbourhood, and clearance operations may, as I have said, incidentally take in fit property reasonably necessary for satisfactory redevelopment.
But—and I make no apologies for repeating this point—the test of the authority's action is the condition of the houses in the area. I can assure my hon. Friend and the House that this is the test which the present Minister stringently applies.
The level of compensation payable upon compulsory acquisition also follows as a general principle from the condition of the houses within the order. This rule has been applied since 1919. Where a house has been found unfit for human habitation, compensation is limited to the value of the site upon which it stands. The justification for this rule, essentially, is that public money should not be payable in respect of bricks and mortar that have been condemned and should be cleared as soon as possible. Successive Governments have upheld this philosophy and it would be quite wrong for me to suggest that the present Government were prepared to abandon it.
Nevertheless, over the years, the basic proposition of site value compensation for unfit houses has been modified to meet changing circumstances and the acquisition of fit houses is compensated at full market value. There are two major modifications of the site value rule that I want to deal with and each is of


especial concern to owner-occupiers who, as my hon. Friend has made clear, make up such a large proportion of Portsmouth's population.
My understanding—from his expert knowledge, my hon. Friend will know about this—is that between 40 and 50 per cent. of the city's houses are owner-occupied and that many of these are to be found in areas where redevelopment is probably not that far off. Moreover, older people tend to live in and own these houses, and this is an additional reason why we should take the greatest possible care to avoid incidental hardship wherever possible.
Payments in addition to site value are made where unfit houses have been well maintained, despite their inherent defects. This prevision dates from 1935, and payments now amount to at least four times the rateable value of the house for owner-occupiers and, in other cases, at least twice the rateable value. They may be more where the local authority is satisfied that a greater sum has been spent on maintenance during the preceding five years. In any case, they are payable to whoever is responsible for the work. About £1 million annually is paid out by local authorities in respect of well-maintained payments in, perhaps, 12,000 cases.

Mr. Graham Page: On the question of well-maintained payments, will the hon. Gentleman ask his right hon. Friend to consider this? The victims do not understand what is meant by well-maintained payments. Could the local authorities recommend to the Minister which houses ought to have well-maintained payments, or, alternatively, could the Minister's inspector inspect all the houses, not just those in respect of which people have claimed the well-maintained payment?

Mr. Mellish: That is a fair point. I give the hon. Gentleman the assurance that I shall take it back to my right hon. Friend—I shall not take up the time of the House now—to see whether we can apply such instructions.
There is no reason why it should not be done. Where clearance orders are made, and a great number of houses are, in fact, in fit condition, but they happen to be unlucky enough—if that is the right word—to be involved in a re-

development area, we ought to fall over backwards to make sure not only that those houses are given fair compensation but that well-maintained payments are given. There should be a careful test to see how generous we can be in these cases. I do not quarrel with the hon. Gentleman about that.
I had referred to the well-maintained payments, and I was coming to the next point. The most significant modification of the site value rule that has so far been made, however—it is important to say this—is the supplemental payments to owner-occupiers who bought their houses between 1st September, 1939, and 12th December, 1955, while slum clearance was in abeyance. In those cases, the payments bring compensation up to the full market value as if the house had not been found unfit.
The statutory provisions were due to expire in December 1965, but they were continued by the Housing (Slum Clearance Compensation) Act, 1965, for qualifying owner-occupiers who have not had 15 years' possession of their houses. Recently, these supplementary payments have amounted to £3 million a year and are being made in about 6,500 cases. So, with payments for good maintenance, getting on for one-third of all cases receive more than site value today. This should help to dispel the idea that the Government, with the connivance of the local authorities, go out of their way to pay only the minimum.
It could well be argued, and it has been argued, that the degree and extent of these modifications to the site value rule serve only to demonstrate that the good is the enemy of the best. Payments in respect of good maintenance frequently do comparatively little to bridge the gap between site and full market value, although the quality of the house has gone some way towards bridging the gap between the old-style slum and fitness.
Again, the supplemental payments to owner-occupiers do not extend to all owner-occupiers and only to those who otherwise qualify if they have had their houses for less than 15 years. Portsmouth Council has in mind its own legislative proposals to remove some at least of those restrictions upon the entitlement of owner-occupiers to full market value, but the House will understand if I do not


comment on that. All I can say now is that those people, whether owneroccupiers or others, who have lavished care and affection upon their houses and have turned them into comfortable homes for the time being, despite their inherent defects, merit our care and encouragement.
I understand and appreciate the points made by my hon. Friend, and by hon. Members opposite, too, who, with no party bias on this question, merely want to see that justice is done. I have listened with great interest to what my hon. Friend has said. I respect him for being

a first-class constituency Member who feels these things personally and deeply. I assure him that the points he has raised will be given the fullest consideration in our review of these problems relating to older houses.
I further assure my hon. Friend that, in the meantime, my right hon. Friend will continue to administer the existing legislation dealing with the clearance of houses with the strictest regard for hardship that might inadvertently be caused

Question put and agreed to

Adjourned accordingly at half-past Eleven o'clock